According to the latest data for May and June released by BoG, Greek banks’ ECB funding eased by €58.6bn m-o-m to €3.45bn in May, while soared by €70.2bn m-o-m to €73.66bn in June. At the same time, BoG liquidity provided to Greek banks through the ELA mechanism climbed by €64.9bn m-o-m to €124.08bn in May and then slipped by €62.1bn to €61.94bn in June. The jump in May is courtesy of the banks’ freeze from ECB operations in the second half of May, ahead of the disbursement of €18bn from HFSF for their recapitalisation.

Overall, Greek banks’ Eurosystem (ECB plus ELA) funding rose by €6.3bn or 5.2% m-o-m to €127.53bn in May (from €121.25bn at the end of April), almost fully comprising ELA liquidity, and then by €8.1bn or 6.3% m-o-m to €135.60bn in June (ECB: 54%, ELA: 46%). Note that June figure is the second highest after the peak of €157.09bn recorded in February.

Increasing reliance on Eurosystem funding is mainly attributed to continuing deposit outflows, which reached a new historic high of €9.2bn in May, on heightened sovereign risk due to the political uncertainty related to the May 6 election outcome. Reportedly, withdrawals continued unabated until June 17 elections, while a reversal of the negative trend is anticipated in the post election period. BoG is due to release deposit evolution data for June by the end of month.