Greek deposit outflows have accelerated before this weekend’s elections, two bankers familiar with the situation said, on concern the nation may move closer to abandoning the euro.
Daily withdrawals have increased to the upper end of a 100 million-euro to 500 million-euro range this month, one banker said, asking not to be identified because the figures aren’t public. A second banking executive said the drawdown may have exceeded 700 million euros today. An official for the Bank of Greece (TELL), the Athens-based central bank, declined to comment.
Greek banks are under strain after individuals and companies withdrew about 72 billion euros since the nation triggered a region-wide sovereign-debt crisis in October 2009. While lenders have access to European Central Bank funding, an exit from the euro would cut them off. Depositors are seeking to preserve their cash on concern Greece may adopt a new currency that would immediately drop in value.
Deposit outflows jumped in the days following the May 6 election after parties opposing the bailout by the European Union and the International Monetary Fund won most of the votes, raising doubts about Greece’s future in the euro. They couldn’t form a government and new elections will be held June 17.
Deposit withdrawals slowed as last month drew to a close, National Bank of Greece SA (ETE) Chief Executive Officer Apostolos Tamvakakis said on May 30.
(source: Bloomberg)
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