|
 The Greek central bank - which has warned that the country's future
in the euro and even the European Union is at risk unless the
government strikes a deal with its creditors - tried to calm savers
by saying that the banking system remained stable.
Germany, the biggest European contributor to the bailout programs
that have kept Greece afloat for the past five years, insisted it
still wasn't too late for Athens to come to terms with its creditors
at the EU and International Monetary Fund.
Greece is on course to default on a 1.6 billion euro debt repayment
it must make to the IMF in less than two weeks unless the creditors
resume funding that was halted last August.
With the leftist-led government refusing to accept the creditors'
demands for more reform and budget cuts, some anxious Greeks have
been emptying their bank accounts, fearing that curbs on withdrawals
will be imposed under a capital controls regime, as Cyprus did
during a crisis in 2013.
Policymakers at the European Central Bank, which is keeping the
Greek financial system on life support by providing emergency funds,
agreed on Friday to raise the amount of cash it provides, a banking
source said.
Including the billion withdrawn on Thursday, savers have pulled 3
billion euros ($3.4 billion) from Greek banks since talks between
Athens and its creditors collapsed at the weekend, the banking
sources told Reuters. That represents about 2.2 percent of household
and corporate deposits at the end of April. The figures were
provided on condition of anonymity as the statistics were not yet
officially published.
Tsipras played down the gravity of the situation. "All those who are
betting on crisis and terror scenarios will be proven wrong," he
said in a statement. "There will be a solution based on respecting
EU rules and democracy which would allow Greece to return to growth
in the euro."
Greek central bank chief Yannis Stournaras also tried to shore up
confidence. "The governor of the Bank of Greece confirms the
stability of the banking system, which is fully secured by the joint
actions of the Bank of Greece and the European Central bank," the
bank said in a statement.
Earlier this week, Stournaras drew fire from government supporters
when the bank said in a report that failure to reach an agreement
would "mark the beginning of a painful course that would lead
initially to a Greek default and ultimately to the country's exit
from the euro area and, most likely, from the European Union".
ALL IS NOT YET LOST
After euro zone finance ministers failed to settle the dispute on
Thursday, government leaders of the currency bloc will try to break
the stalemate at an emergency summit on Monday.
Germany insisted all was not yet lost. "It's not too late for this
and of course we hope that such an agreement is possible,"
government spokesman Steffen Seibert said in Berlin.
If Greece defaults at the end of this month, it will be the first
euro zone member to do so. Tsipras's government has refused the
creditors' demands that it raise taxes and cut spending,
particularly on pensions, saying this would deepen one of the worst
economic depressions of modern times.
Greek share prices rose after Tsipras's office issued the statement,
in which he described the emergency summit as "a positive
development on the road toward a deal".
[to top of second column] |
Two officials with knowledge of the finance ministers' meeting in
Luxembourg on Thursday said ECB executive board member Benoit Coeure
had said he was unsure whether Greek banks would open next week.
European Commission President Jean-Claude Juncker said he feared the
Greeks appeared to believe that "there is someone in Europe who can
pull a rabbit out of the hat at the end. But this is not the case".
"I don't understand Mr Tsipras," Juncker told Germany's Der Spiegel
magazine.
IMF chief Christine Lagarde also raised the stakes on Thursday by
telling Greece there would be no grace period for debt due on June
30.
Tsipras was due to meet President Vladimir Putin on the second day
of a visit to Russia on Friday - a trip that has raised eyebrows
given the EU is at loggerheads with Moscow over the violence in
eastern Ukraine. Russia's deputy prime minister said Moscow could
consider giving financial aid to Greece, although Russia has
previously played down such prospects.
UNTIL THE LAST MINUTE
So far, there have been no signs of panic on the streets of Athens
or queues forming outside bank branches. But if deposit flight
continues faster than the extra emergency liquidity assistance (ELA)
that the ECB grants Greek lenders, it could force Athens to impose
capital controls.
"There are no lines or panic, it has been a quiet and gradual phase
of withdrawals," said one of the bankers who disclosed the figures
for withdrawals. "They are due to worries whether a deal will be
clinched with the country's lenders."
A government spokesman has previously denied plans for imposing
capital controls.
While fears of general disruption and chaos have grown in recent
days, Greece's biggest oil refiner Hellenic Petroleum <HEPr.AT> told
Reuters it has in place a contingency plan to ensure Greece has
enough fuel supplies for several months in case of a national
emergency.
Although fed up with years of austerity, the majority of Greeks want
to stay in the euro zone. Thousands took to the streets on Thursday
night calling for a deal.
"The silent majority has spoken: we are staying in Europe," the
conservative Greek daily Eleftheros Typos said, commenting on the
rally.
(Additional reporting by Angeliki Koutantou in ATHENS, Robin Emmott
in LUXEMBOURG, Michael Nienaber, Caroline Copley and Paul Carrel in
BERLIN; Writing by Matthias Williams; Editing by Peter Graff and
David Stamp)
[© 2015 Thomson Reuters. All rights
reserved.] Copyright 2015 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed. |
