Pressure high on Greek government as cash demand refused
Greek demand for return of 1.2 billion euros ($1.32 billion) in cash taken from its bank rescue fund is denied.

The Greek government is now under severe pressure to obtain bailout funds, as its demand for cash from one of its European creditors was refused late on Wednesday.

Greece had asked the European Financial Stability Facility, one of its creditors, to return €1.2 billion ($1.32 billion) which had been taken from its own bank stabilization fund by the EFSF.

But the Eurogroup of 19 member states, another creditor, announced late on Wednesday that Greece had no legal rights to these funds. They did, however, propose to reconsider the matter in the future.

A spokesman for the German finance ministry said the funding had been made provisionally available to Greece during bank stress tests, but that it was not intended as a permanent provision.

The move leaves Greece's leftist coalition government without any resources except for emergency loans from the European Central Bank. Economists estimate that the country will be out of funds to run its banks and public services by the end of April at the latest.

The government has been obliged to make use of funds from the country's health system and other public services to make debt payments in March.

The Greek government presented a list of economic reforms to the Eurogroup on Monday. If these reforms are approved by the European creditors, there is a chance that the next bailout payment of €7.2 billion euros ($7.8 billion) could be made in time for the Greek government to avoid default.

Last Modified: 2015-03-26 10:31:39
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