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 Customers were queued up outside bank branches open for the first
time in three weeks on Monday after they were closed to save the
system from collapsing under a flood of withdrawals.
Increases in value added tax agreed under the bailout terms also
took effect, with VAT on food and public transport jumping to 23
percent from 13 percent. The stock market remained closed until
further notice. The bank closures were the most visible sign of the
crisis that took Greece to the brink of leaving the euro earlier
this month, potentially undermining the foundations of the single
European currency.
Their reopening followed Prime Minister Alexis Tsipras' reluctant
acceptance of a tough package of bailout demands from European
partners, but a revolt in the ruling Syriza party now threatens the
stability of his government and officials say new elections may be
held as early as September or October.
"Things are better than the last few weeks. Thank God we didn't end
up with the drachma!" said 62-year-old pensioner Maria Papadopoulou.
"I came to pay bills and my taxes today. Last week I couldn't and
all of this is very tiring for the older people like me."
Limits on withdrawals will remain, however -- at 420 euros ($455)
per week instead of 60 euros per day previously -- and payments and
wire transfers abroad will still not be possible, a situation German
Chancellor Angela Merkel said on Sunday was "not a normal life" and
warranted swift negotiations on a new bailout, expected to be worth
up to 86 billion euros.
"Capital controls and restrictions on withdrawals will remain in
place but we are entering a new stage which we all hope will be one
of normality," said Louka Katseli, head of the Greek bank
association.
Greeks will be able to deposit cheques but not cash, pay bills as
well as have access to safety deposit boxes and withdraw money
without an ATM card.
Bankers said there may be minor disruptions after the extended
interruption to services but said they expected services to resume
largely as normal.
"I don't expect major problems, our network and the network of our
competitors are ready to serve our clients," said a senior official
at Piraeus Bank, one of the big four lenders. "There might be lines
because many people will want to withdraw money from their deposit
boxes," the official said.
Athens initiated procedures to pay 4.2 billion euros in principal
and interest to the European Central Bank due on Monday after
European authorities agreed last week to provide emergency funding
assistance,
It is also paying 2.05 billion euros to the International Monetary
Fund in arrears since June 30, when Greece became the first advanced
economy to default on a loan to the IMF, along with 500 million
euros owed to the Bank of Greece.
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VOTE ON WEDNESDAY
Tsipras is eyeing a fresh start and swift talks on the bailout aimed
at keeping Greece afloat but faces hurdles with factions in his
party.
Although the Greek parliament approved the bailout package on
Thursday, the 40-year-old prime minister was forced to rely on votes
from the opposition after 39 rebels from Syriza refused to back the
government by voting against or abstaining.
A second vote will be held on Wednesday on measures including
justice and banking reforms and a similar outcome is expected. The
voting arithmetic is finely poised, however.
Together with his coalition partners from the right-wing Independent
Greeks party Tsipras has 162 seats in the 300-seat parliament. But
Thursday's rebellion cut his support to just 123 votes, meaning he
is likely to need opposition votes again.
Some officials in the government have suggested that if support from
lawmakers from within the coalition dropped below 120 votes, early
snap elections would have to be called while the bailout was still
being negotiated.
Their argument is that under Greek law, the lowest number of votes a
government can have to win a confidence motion is 120 out of 240,
the minimum quorum in parliament for a vote to be valid.
Dropping below 120 would be a symbolic blow but whether it would
actually push Tsipras to step down is unclear given that he would
have the support of the pro-European opposition parties if a
confidence vote were called.
"What worries me is that some people still think that there would be
no austerity if we were out of the euro. This argument is absolutely
false," State Minister Nikos Pappas, one of Tsipras' closest aides
told the leftist Efimerida Ton Syntakton newspaper.
Acceptance of the bailout terms and reopening of the banks have
marked a new stage for Tsipras after months of difficult talks.
The bailout terms, which are tougher than those rejected in a
referendum earlier in July, include tax hikes, pension cuts, strict
curbs on public spending, an overhaul of collective bargaining rules
and a transfer of 50 billion euros of state assets into a special
privatization fund.
(Additional reporting by Renee Maltezou, Angeliki Koutantou and
Lefteris Papadimas; Writing by Ingrid Melander and James Mackenzie;
Editing by Jon Boyle, Anna Willard and Sonya Hepinstall)
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