Benoit Coeure, a member of the Executive Board of the European Bank (ECB), is warning that Greece’s “dialogue” with investors will not be easier than Athens’ negotiations with creditors.

In the first public statement of an ECB official since the completion of the bailout memorandum on 21 August, Coeure underlined that the continuation of reforms and avoiding backpedaling are preconditions for Greece to regain the trust of the markets.

Regarding the sustainability of the Greek debt, the ECB official said that the Eurogroup’s decision on debt relief was an important step toward restoring its sustainability in the medium-term, but that there are dangers in the longer term.

In an interview with the Athens daily Kathimerini, Coeure referred to the need to improve the governance of banks, and called on the government to avoid practices that could influence their credit decisions.

He noted that despite the bolstering of bank capital, the quality of their capital is low, due to deferred tax credits.

Coeure stressed the importance of reducing the number of Non-Performing Loans (NPLs).

He also noted the importance of improving the effectiveness of the judicial system and of further improving the framework of bank governance.

“In any event, it is very important for authorities not to attempt to influence the credit decisions of banks, but rather to focus on improving their framework of operation,” Coeure underlined.

Regarding the issue of whether pensions will or will not be cut in January, as agreed with creditors, Coeure said that for the ECB , the paramount issue is reaching fiscal targets with measures that are investment-friendly, and in that context he referred to the issue of direct taxation.

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