ATHENS: Greek banks need state aid to get through the losses of a planned write-down of the country's sovereign debt but the lenders are pressing the government not to take over management at the same time.

Under a second debt rescue agreed in October with the EU and IMF, private creditors agreed to write-down 50 per cent of their holdings of government bonds, effectively cutting Greek's debt burden by 100 billion euros.

The accord also made available 30 billion euros to help the Greek banks cope with the resulting losses on their holdings of Greek government bonds, put at around 50 billion euros, and which they could not cover themselves.

The aim of the 30 billion euros lifeline is to keep the banks alive and lending so that the Greek economy, mired in recession since 2008, is not deprived of essential credit to drive new business.

Source: The Daily Sun/ Bangladesh/ 9th Dec 2011