Greece banks need €14.4bn buffer in case of economic turndown, ECB says

Greece's four biggest banks need to plug a €14.4bn (£10.2bn) hole if the country is to get through another economic downturn, the European Central Bank (ECB) said over the weekend.

The ECB, which conducted months of stress tests on the lenders before announcing its findings, have given Alpha, Piraeus, National Bank of Greece and Eurobank until Friday to tell it how they intend to come up with the money.

Of the four banks, Piraeus was the most vulnerable, needing to raise €5bn.

"Overall, the stress test identified a capital shortfall across the four participating banks of €4.4bn, under the baseline scenario, and €14.4bn under the adverse scenario," the ECB said.

"[The addition capital will] result in the creation of prudential buffers at the four Greek banks, which will improve the resilience of their balance sheets and their capacity to withstand potential adverse macroeconomic shock."

The figure is notably smaller than the €25bn that had been set aside in the bailout package agreed earlier this year.

"This is an important step in the implementation of the three-year Greek programme under the European Stability Mechanism," the European Commission said.

The chief executive of NBG released a statement which said: "NBG intends to cover the capital shortfall under both scenarios with private sector funds as much as possible and by its own capital actions, aiming to limit the need for state aid which would burden Greece's debt."