U.S. Markets

IMF says ECB proposal constructive, no need for asset quality check

FILE PHOTO: Now head of the IMF's European Department Poul Thomsen attends a conference in Athens on April 15, 2013. REUTERS/John Kolesidis/File Photo

ATHENS (Reuters) - The International Monetary Fund said on Thursday that it sees no financial stability concerns in Greece’s banking system and that a European Central Bank proposal was constructive, removing the need for an asset quality review on the country’s lenders.

“On the subject of the Greek banking system, let me emphasize that we see no financial stability concerns at all in Greece,” Poul Thomsen, head of the IMF’s European Department, said in a statement.

“The issue is that we need to be sure that there is a strategy to deal with Greece’s exceptionally high level of nonperforming loans over the medium term.”

He said the European Central Bank’s proposal to bring forward already planned stress tests and undertake targeted asset reviews, without having to go through a full asset quality review (AQR), was constructive.

Reporting by George Georgiopoulos, Renee Maltezou