ECB keeps Greece on life support as leaders meet

By George Georgiopoulos and Shadia Nasralla

ATHENS/VIENNA (Reuters) - European Central Bank chiefs will discuss whether to extend Greece's funding lifeline again after the meeting of euro zone leaders on Monday, officials said.

With nervous Greek savers and firms withdrawing billions of euros in cash from accounts, the country's banks are almost entirely dependant on central bank funding to avoid collapse and potentially dragging down the country with them.

After hiking emergency credit for Greek lenders to about 86 billion euros last week, the ECB agreed to a further 2 billion euros of such Emergency Liquidity Assistance (ELA) on Monday, people with knowledge of the matter told Reuters.

This won breathing space for Athens, allowing teetering banks to stay open as Greece's Prime Minister Alexis Tsipras sought to clinch a deal with euro zone backers at a meeting in Brussels.

Austria's central bank chief Ewald Nowotny later said the Governing Council, which is made up of central bank chiefs from around the euro zone and the ECB's executive, would talk again to discuss the outcome of the leaders' summit.

This was confirmed by other people familiar with the matter.

"The Governing Council raised the ELA cap and will convene again via teleconference at any time necessary," one source said, after savers pulled about 4.2 billion euros from Greek lenders last week.

But Nowotny warned that Greece risked losing access to further emergency funding for its banks if the government does not reach a prompt deal.

"This credit is advanced until the end of today (Monday) and whether we can continue to extend it depends on our rules as well as the result (from negotiations) today," Nowotny told reporters.

"(ELA) runs precisely for one day because there is a summit meeting (of leaders) to deal with the Greek question and the ECB, sensibly enough, did not want to anticipate the result," he said on the sidelines of a conference in Vienna.

Nowotny, who also underlined the importance of finding a long-term 'perspective' that put Greece's future and that of its banks on a solid footing, emphasised the urgent need to reach political agreement.

The ECB had been approving emergency funding on a weekly basis but is now meeting almost daily as bank withdrawals continue and negotiations reach a climax.

(Writing John O'Donnell; Editing by Catherine Evans)