Greece's current liquidity and collateral position very fragile

Greek banks have filled the funding gap created by the deposit outflows and the closure of repo operations with international banks with the Eurosystem's liquidity since the beginning of the year. Greek banks' total borrowing at the ECB's regular operations amounted to €56bn at the ed of 2014, with negligible usage of ELA. 

Their usage of the ECB liquidity has increased to about €118bn as of the end of May and is estimated to €125.4bn currently, of which €38.8bn at the MRO and LTRO, while the ELA funding via the Central Bank of Greece should be close to the current limit of €89bn. At the moment, the Eurosystem is the only source of funding for the Greek banking system.

The capital controls introduced on 29 June after the announcement of the referendum have reduced significantly the pace of deposit outflows. However, with depositors continuing towithdraw from ATM machines at a limit of €60 per day, Greek banks' liquidity needs have reached a level very close to the current ELA ceiling. 

Therefore, for some of them the risk of running out of liquidity in the very near term is high, especially if the ECB keeps freezing the ELA provision at the current level of €89bn, says Barclays.