The Greek government has issued a decree envisaging the compulsory transfer of local and regional authorities’ cash reserves to the country’s central bank. It explained the move by saying it was an “urgent and unforeseen need.”
“Central government entities are obliged to deposit their cash reserves and transfer their term deposit funds to their accounts at the Bank of Greece,” the decree published on the government website on Monday said. The “regulation is submitted due to extremely urgent and unforeseen needs,” it added.
The government is ready to make an exception for funds needed by local authorities to make their immediate payment needs. The decree also excludes pension funds and some state-owned firms. It acts retrospectively from March 17.