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GD         Turnover  mln.

ELA ceiling lower by EUR 5.0bn

The Bank of Greece announced yesterday that the ELA ceiling dropped by EUR 5.0bn to EUR 33.9bn until Sep 20. We note that the actual use of ELA funding at the end of July (latest available) stood at EUR 34.6bn.

The aforementioned decision, one of the largest drops during the last months, reflects a significant improvement in banks liquidity as well as positive outlook for the coming weeks. 

In addition, it could also partly reflect BoG’s and banks’ decision to reduce their liquidity buffers.

Potential factors supporting banks are i) positive trends in deposit flows,

ii) deleveraging as demand for loans remains subdued,
iii) more interbank repos using Greek risk assets as collateral and
iv) asset disposals which usually are positive for banks’ liquidity.
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