ATHENS -- Greece's four biggest banks have been restored to solvency after a EUR18 billion cash injection in taxpayer money, allowing them to resume borrowing from the European Central Bank, the head of the country's bank rescue fund said Wednesday.

The fresh infusion boosted the banks' capital-to-risk ratio to 8%, the minimum required by the ECB for financing, Panayotis Thomopoulos, head of the Hellenic Financial Stability Fund, said at a news conference.

National Bank of Greece SA (NBG) received EUR7.43 billion, Alpha Bank AS (ALPHA.AT) got EUR1.9 billion, EFG Eurobank Ergasias SA (EUROB.AT) got EUR3.97 billion and Piraeus Bank SA (TPEIR.AT) received EUR4.7 billion.

Part of a financial aid package provided by the European Union and International Monetary Fund, the capital consists of bonds issued by Europe's temporary bailout facility--the European Financial Stability Facility--and is aimed at covering bank losses from Greece's EUR200 billion debt restructuring in March. The HFSF announced the injection on Tuesday.

Technically Greek banks have been insolvent since taking huge losses on their holdings of government bonds. Together the four lenders account for roughly 80% of Greek banking assets.

Earlier this month the ECB temporarily suspended the banks from borrowing much-needed liquidity, a move seen as putting pressure on the HFSF to speed up the cash injection.

That capital boost will tide the banks over until they complete a formal recapitalization later this year. By September, the banks are expected to tap shareholders for an increase aimed at restoring their core Tier 1 ratio--the narrowest measure of a bank's capital base--to above the 9% threshold demanded by Greece's central bank.

Although shareholders are expected to participate, the HFSF will underwrite the capital boost and is expected to take up roughly 90% of the new shares issued, effectively nationalizing Greece's banking system.

In a bid to ensure the rights of private shareholders--and minimize government meddling--Greece and its official creditors are weighing a plan to give investors incentives to participate in the capital increase. But no final decision is expected ahead of next month's elections.

The four banks will present a restructuring and capital plan to the HFSF in next three months, and the final decisions on the recap plan will be issued by presidential decree, HFSF Vice President Anastasios Gagalis told reporters.

After this week's EUR18 billion disbursement, the HFSF still holds some EUR7 billion in bonds and EUR700 million in cash, Thomopoulos said. That also excludes funds earmarked for the small Proton Bank SA (PRO.AT), which the government took over last year.

This money is off limits to Greece's cash-strapped state, Thomopoulos said, despite recent hints that the Greek government is eyeing the funds to carry it through a looming cash crunch.

According to a recent letter sent by former Prime Minister Lucas Papademos to President Karolos Papoulias, the government could run out of cash by mid-June and would likely have to draw some EUR3 billion from the bank fund to cover its needs after that.