It looks like Greece has come out the victor after months of hanging on a thin thread and Athens will once again be rescued by its Eurogroup partners.
Months of haggling have brought the crisis around 360 degrees and the ECB is back funding Greece’s debts that have been accumulating for years. The European Central Bank increased its emergency lending to Greek banks in hopes that other lenders will step into the fray and provide additional funding so the country’s financial system will have sufficient money to open their doors after more than two weeks of closures.
Funding Approved
The Greek parliament approved an austerity reform package in the early hours of Thursday morning and ECB’s president, Mario Draghi agreed to add an additional 900 million euros ($978 million) in loans over the next week.
Speaking from the ECB's headquarters in Frankfurt, Draghi said, "We have today accommodated the Bank of Greece request, though scaled to one week. We want to see how the situation will evolve."
Greece’s banks have been closed for the past three weeks and ATMs have stopped dispensing money after limiting withdrawals to $60 a day following a referendum rejecting the austerity plan.
For years, the country has received assistance from the Emergency Liquidity Assistance (ELA) in the form of loans given to Greek lenders to boost their solvency. The funds actually come from the central banks of each individual euro zone country.
Up until now, the ECB had already poured more than 89 billion euros into Greece’s coffers.