ECB to consider giving Greek banks access to cheap funding: Draghi

European Central Bank (ECB) President Mario Draghi waits to address the European Parliament's Economic and Monetary Affairs Committee on June 21.
European Central Bank (ECB) President Mario Draghi waits to address the European Parliament's Economic and Monetary Affairs Committee on June 21.PHOTO: REUTERS

FRANKFURT (Reuters) - The European Central Bank will consider restoring Greek banks' access to its cheap funding operations, European Central Bank president Mario Draghi told the European Parliament's economy committee on Tuesday.

Sources with direct knowledge of the matter told Reuters earlier that a decision could come as soon as Wednesday, at the ECB's next governing council meeting, allowing banks to come off an expensive emergency lifeline after more than a year .

Greek banks lost their access to the ECB's cheap funding mechanism early last year when Athens came to the brink of being ejected from the euro zone.

Regaining the funding would be a big step in normalising an economy still weighed down by capital controls and adjustments related to its bailout.

Mr Draghi added, however, that Greece would have to meet further conditions before it could take part in the central bank's purchase of 80 billion euros (S$120.86 billion) per month worth of assets, mostly government bonds.