Document Type
Case Study
Case Series
Broad-based Capital Injections
JEL Codes
G01, G28
Abstract
In October 2008, in the midst of the Global Financial Crisis (2007–09), the Greek government announced a €28 billion ($36 billion) government package. Greek Law 3723/2008, “Enhancement of Liquidity in the Economy in Response to the Impact of the International Financial Crisis,” was passed and approved under European Union State Aid rules. The Greek law provided for three voluntary programs: recapitalizations (€5 billion), guarantees (€15 billion), and securities (€8 billion). This case study exclusively examines the recapitalization program. In this program, the Greek government acquired convertible preferred shares in banks in order to build and maintain banks’ Tier 1 capital at a minimum of 8% of risk-weighted assets. By July 2009, 10 banks had received capital injections for a total of €3.8 billion.
Recommended Citation
León Hoyos, Manuel
(2021)
"Greece (2008) – Capital Injections,"
Journal of Financial Crises: Vol. 3
:
Iss. 3, 106-127.
Available at:
https://elischolar.library.yale.edu/journal-of-financial-crises/vol3/iss3/7
Date Revised
2021-12-15
Included in
Economic History Commons, Economic Policy Commons, Finance and Financial Management Commons, Policy Design, Analysis, and Evaluation Commons, Public Policy Commons