Greek Banks Ask for More Financial Support

Greek banks, hit by a series of credit rating downgrades linked to the country's debt crisis, have asked the government for more financial support, Finance Minister George Papaconstantinou said on Wednesday. "The banks have asked to use the remaining funds of the support plan," he told reporters, referring to a package first agreed by the previous conservative government in 2008.

Photo: Greek Banks Ask for More Financial Support

Greek Banks Ask for More Financial Support

About 17 billion euros ($22.72 billion), mainly in state guarantees, remain in the 28 billion euro support scheme, launched to help Greek lenders cope with the global credit crisis.The Central Bank of Greece said non-performing loans in the banking system rose further in the last quarter of 2009, bringing the full-year ratio to 7.7 percent, Reuters informs.

Once again, Greece took center stage as investors continued to fret about the country's ability to pay off its debts — the ten-year spread between Greek and Germany bond yields stood at 3.84 percentage points, just below Tuesday's all-time high but way up on the 3 percent level when the EU agreed on an aid program that would involve the International Monetary Fund.

Talk that Greece was looking to renegotiate the terms of the backstop agreement — denied by the finance ministry — as a technical team from the IMF arrived in Athens has fueled the spike in Greek borrowing costs, The Associated Press reports.