Initial bailout funds for Greek banks will be placed in a special account not on their balance sheets and lenders will receive fresh equity only after a “stress test” is finished by the end of October, several sources told Reuters yesterday.

An initial €10 billion will be made available “immediately” to shore up confidence in the Greek banks, several sources said, while authorities conduct a detailed asset quality review, that is expected to take several months.

Greek banks will also have to submit viable business plans to European authorities before fresh equity is disbursed and will only receive cash from the special account, which will be controlled by the European Stability Mechanism, once resolution authorities sign off on the plans, the sources, who asked not to be named, said.

Another €15 billion will be available before the end of the year, the sources said.

“When the full recapitalisation of banks is fulfilled it will have a major impact for the economy,” one of the sources said.

We know that there is around €40 billion in cash under the mattresses

“We know that there is around €40 billion in cash under the mattresses in the real economy and that money could come (back to the banks) very very quickly.”

Greek banks, closed for much of July, have been kept on a lifeline by the European Central Bank and limit cash withdrawals to €420 per week to prevent a run by clients.

Greece agreed this week on the its third bailout deal, potentially worth up to €86 billion, and expects to have all approvals in place by August 20, when a €3.2 billion payment to the ECB is due.

Greece will move rapidly to privatise its ports, regional airports and its power grid operator under a memorandum of understanding (MOU) agreed with its international lenders.

According to the 29-page MOU, a copy of which was obtained by Reuters, Greek privatisation proceeds, excluding bank shares, are expected to total €6.4 billion between 2015 and 2017.

Athens has committed to take “irreversible steps” by October 2015 to privatise grid operator ADMIE unless an alternative scheme offering equivalent results is presented.

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