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ECB's Noyer: 'Greek Banks Should Be Recapitalized Soon'

Christian NoyerBank of France Governor and European Central Bank (ECB) Governing Council member Christian Noyer estimates that a first “injection” of capital into Greek banks would be “desirable to stabilize the sector” before the end of the summer, rather than after the results of a series of tests to be carried out by the ECB during the fall.
In an interview to French newspaper Le Monde published on Friday, Noyer claimed that the first installment of the new recapitalization plan under the July 13 agreement should be offered immediately after the signing of the new rescue package, which is expected to take place on August 11.
“The emergency is to stabilize the economy and restore confidence in order to have deposits coming back,” he said. Asked whether the contribution of depositors should be sought, as happened in Cyprus in 2013, Noyer shared that this potential is “one of the aspects that should be clarified as soon as possible, if possible during the summer months.”
He clarified, though, that he is against the idea to address the problem through a haircut of large deposits in Greece, as they mainly belong to small companies.
“This would destroy the country’s production means,” he said, revealing that others on the ECB’s Governing Council share his view.

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