Greece - Troika deadlock over banking sector

According to the British newspaper "The Financial Times," Athens is contending that its financial system requires less than 6 billion euros of new capital while international monitors insist it needs at least three times that amount.

The €6bn estimate was calculated by the Greek central bank after a long-awaited private analysis by BlackRock and was provided to monitors from the so-called "troika" of international lenders ahead of their arrival in Athens today to resume talks over their latest review of the bailout program.

The review, the most contentious in more than a year, was to be completed in September, but troika officials say less than half of the economic reform commitments made by the Greek government have been completed. Their return to Athens on Monday is their first visit in two months.

The dispute over banks' recapitalization needs risks adding a new, potentially explosive point of contention between the two sides, as it will have a direct effect on whether Athens will require a third international bailout when the remaining €10.1bn in EU funding in the current €172bn rescue runs out later this year.

The Greek government had hoped to tap an estimated €10bn in bailout cash remaining in its bank rescue fund to pay for other government expenses as part of a strategy to avoid a third bailout. The International Monetary Fund last year estimated the current bailout is nearly €15bn short of cash over the next two years.