Daily Management Review

Greece Wants Complete Bailout Package or Nothing


Bank Shares Pull Down Greek Share Market Further

Greece Wants Complete Bailout Package or Nothing
Ruling out accepting the bridge loan proposed by the European Commission in July, the Greek government made it clear that it would agree to nothing but to a complete bail out amount.

This was declared by Nikos Filis, the parliamentary spokesperson for Greece's ruling Syriza party on Wednesday.

The nation was already working on the terms to receive a first payment of €25bn, said Filis.  

“We will not accept new prior actions (reform conditions in place) in order to have a small bridge loan,” Filis said on Greek state television station ERT .
The disbursement of the €25 billion for the first installment would be decided upon after the Greek government finalizes the deal and inks the bailout program, Filis said.
The ruling government in the debt stricken country however is facing strict opposition from within the members of the ruling party Syriza against the government accepting the strict norms for Greece laid out in return for a complete bailout assistance package.
On Wednesday, Filis urged the members of his party to stop opposing the austerity measures and the economic reforms linked to the bailout as proposed by the creditors and asked the opposing members to put the country first.
“Differences should not prevail over the party's unity and the country's stability,” Filis said. He also warned against a split in the party over the issue and expressed fears that it such an eventuality would damage the government.

A bailout deal is expected to be concluded by August 18 even as the talks between Athens and its international creditors are expected to resume on Wednesday.
Greece is due to pay off debt of €3.5bn to the European Central Bank on August 20 and hence it is critical that the country manages to ink out a deal by then.

Meanwhile, the Greek stock market continued to fall as the bank shares of the country brought the index down significantly on Wednesday- for a third consecutive day.  

A drop of 3.39% was seen at the Athens Stock Exchange as the index fell to 637.55 points on Wednesday morning after the index closed at its lowest since September 2012 on Tuesday. 
The Piraeus Bank lost 29.59 % shares to touch to €0.14 per share and was the worst performer. The other banks that performed badly were the Alpha Bank (that dropped by 29.56% to touch €0.11 per share), the Eurobank Ergasias (fell by 26.79% to reach €0.05 per share and the National Bank of Greece (slid by 26.76% to end at €0.05 per share).
In the past two days the share value of the Greek banks has lost half their value and two thirds of their value since Syriza party won the country's general election in January.
After remaining shut for five weeks, the Athens Stock Exchange Market reopened on Monday with heavy losses as it plunged by 23%, caused primarily by the downward slide of the bank shares which fell as much as by 30%. This is the maximum that is allowed for a share to fall before closing trading on that particular script.

(Sources: www.digitallook.com & www.reuters.com)