The Greek Bank Run Spreads To All Four Largest Banks

Tyler Durden's picture

While moments ago Greece was downgraded by that paragon of analytical and timing virtue, Fitch, to a negative outlook from stable, that is largely meaningless for a nation, devoid of tax revenues and increasingly deposits, which is suddenly imploding at an ever-faster motion.

What is relevant is that following yesterday's report that two Greek banks had suffered sufficiently material deposit withdrawals to force them to apply for the unpopular and highly stigmatizing Emergency Liquidity Assistance program with the ECB, now the other two of Greece's largest banks have also succumbed to reserve depletion after the Greek bank run appears to have gone viral. As Greek reports, now all four Greek banks have requested ELA assistance from the same ECB president who earlier today is said to have unceremoniously kicked out Greece from the ECB's QE program.

As a reminder, this is what we learned yesterday via Kathimerini:

Two Greek systemic banks reportedly submitted the first requests to the Bank of Greece for cash via the emergency liquidity assistance (ELA) system on Thursday, in response to the pressing liquidity conditions resulting from the growing outflow of deposits as well as the acquisition of treasury bills forced onto them by the state.


Banks usually resort to ELA when they face a cash crunch and do not have adequate collateral to draw liquidity from the European Central Bank, their main funding tool. ELA is particularly costly as it carries an interest rate of 1.55 percent, against just 0.05 percent for ECB funding.


The requests by the two lenders will be discussed by the ECB next Wednesday.

And now this, from, google translated:

All four banks in request precautionary ELA


People at the Bank of Greece confirmed that it has submitted a request from the four banks to provide liquidity through the ELA and the Bank of Greece, in the prescribed procedure, has informed the European Central Bank. Not specified amount of requests.


To the question of why requested liquidity through "national" ELA and not by the ECB, despite what has been interrupted and remains active financing from Frankfurt, no details were given. Note that all four Greek systemic banks open until February 28 the ECB funding to guarantee Greek government securities.


The provision of liquidity by ELA is significantly "more expensive" than the ECB, which remains less than 0.5%. The difference between the two mechanisms is that in the case of ELA guarantees can use banks are almost all assets of the loan portfolio, while the ECB needed Greek government securities.


It should however be noted that banks also have bonds of the EFSF by the recapitalization which of course no bank wants to "spend" in moments of uncertainty, preferring to exploit even at higher cost securities loans can not use EDU easy neither the ECB nor the capital market. 


Earlier, the Bank of Greece rounds had confirmed the information that already two Greek banks have resorted precautionary liquidity in ELA. The representative of the National Bank, Dimitris Spyropoulos, speaking at said earlier that the National Bank has not had recourse to ELA and does not plan to appeal.


The request of the Greek banks will be discussed next Thursday on the ECB Governing Council in Frankfurt. Information indicates that one of the banks turned to the ELA not participated in the auction of Treasury bills held Tuesday. 


Meanwhile, according to a report in Bloomberg, the Alpha Bank has submitted a request to the Bank of Greece for stimulating fluid through the ELA, the agent to invoke bank executive.


The request was a precautionary measure, and the bank does not expect that you will need to use the funds of ELA on time, said earlier in the official Bloomberg. According to the same publication and Eurobank submitted a request for precautionary line of the ELA.


According to a publication of Dow Jones Newswires, representative of Alpha Bank said the bank wanted the funding as a precautionary measure and does not intend to use it. "We are just superstitious, and be on the safe side. It is the general situation in Greece. There are many cash withdrawals, "said spokesman of Alpha Bank to Dow Jones Newswires.

More here.

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Drachma's picture

Hello to you too. Cheers.

kaiserhoff's picture

At least we know who is next on the gang plank.

Haus-Targaryen's picture

Lets see.  

I think shit will really hit the fan if Syriza wins, which I doubt due to Diebold voting machines.  But that aside -- 

if the EMZ lets Greece go this means one of two things;

1) They (that idiot Italian running the ECB) really do have the situation under control, and will do everything under their power to crush Greece in all things that they do, thus killing off the euro-skeptic movement in the PIIGS.  The EU will step on Greece's neck in a way that makes the rat-shaking of the Ruple in December of last year look like a walk in the park.  

2) The power players that be have deemed it time to plunge the whole world into chaos.  They have put enough of their pieces in the right places to pull the plug without risking their project.  The Greeks make a good skape-goat.  Watchout below.  

I cannot see there being more than this to the above two options.  

If I am Greek, I would be hoping for option #2, if you aren't Greek, #1 is the better of the two options.  

Overfed's picture

Anybody up for playing with some dominoes?

knukles's picture

Good fucking thing we declared those 4 banks as systemic risks, so they aren't anymore.
Back to the ouzo and bungholes, boys!

Son of Loki's picture

"No one saw this coming," Papakoupolis told the Hellenic Assembly.

7.62x54r's picture

A syphalitic retard could see this coming. Next time, they should wear camoflage-pattern condoms.

The second anyone started talking seriously about Grexit, every saver in the country wanted his Euros out of the fucking banks before they could get Drachma'ed.

Bunghole's picture

But i'm only half Greek

BTW, dont forget the olive oil

Citium's picture

If the greeks even get the rumor( or truth) the election was stolen, or rigged, all hell will break loose.

Sirius Wonderblast's picture

3rd alternative - people have enough of it all and rise up. There's enough poverty and resentment.

TheReplacement's picture

More like Greece will grexit and shift to the Russia-China axis.  The BRICs will tide them over with loans until the gas pipeline can start generating revenues with which to pay them back. 

Correct me if I'm wrong but aren't just about all of the seven countries recently cutoff from Russian gas also lined up as potential points of traverse for a southern route? 

"Stay with NATO and freeze or join us and make some rubbles."

Much more subtle than Kiev and Syria.

McMolotov's picture

Helloooo naked woman in my lap!

(just wanna see if it works)

eXMachina's picture

*600 pound gorilla woman" appears with a bag of flour.

noben's picture
noben (not verified) eXMachina Jan 17, 2015 2:44 AM

Kyrie Eleison!

Christe eleison. Efxaristo.

Your guess is as good as mine's picture
Your guess is as good as mine (not verified) eXMachina Jan 17, 2015 4:33 AM

Even a 600 pound gorilla woman isn't going to be able to survive roaming gangs, intent on eating her flesh, in the great reset.


You have been warned.

Joe A's picture

Read somewhere that under ELA the Greek can print 100 billion euro. They can do that, go default on their debt and support the Drachma with this 100 billion. Then they will open up to this new Russian oil pipeline, sell their coastline to the Russians and Chinese (there goes the coastline). China is already investing in new ports an infrastructure.

Perhaps a far fetched fantasy but who knows?

kaiserhoff's picture

If you could buy Greece for $1.39 would you want it?

  Nice avatar;)

Joe A's picture

For sure! I'd move to Greece in a second if I would find myself a nice piece of real estate and something to do (the latter being a challenge). Greece is absolutely a beautiful place and the Greek are great (although a bit unreliable if you want to get something done).

You're the second one today who likes my avatar. I might keep it. I got bored with this paper bag over my head.

7.62x54r's picture

Don't do it. Greece charges insane property taxes, jails you for non-payment, refuses to seize the property, and keeps dunning you for taxes while you sit in jail.

Greek property is cheap for a reason. Buy an acre, and you become a serf.

Haus-Targaryen's picture


Can't live with them --- and yeah thats it.  

JungleCat's picture

Stop saying things that I didn't hear on CNBC.

kaiserhoff's picture

Maybe you should talk to Cognitive Dissonance.

Salah's picture


pods's picture

I think we can call this one Ringfenced.  


IridiumRebel's picture

Waiting til' it spreads to Europe.....

halfasleep's picture

Yeah, saw that verbiage after i posted. much better. "guys guys it's only precautionary!!"

ForWhomTheTollBuilds's picture

Help a brother out here...


They need the ELA because people are walking in and demanding cash right?  If I were a Greek I would electronically transfer my money to a German bank and make that "swept clean" motion with my hands.

On the other hand, I think I remember Cypriots trying the same thing and having their money transfered right back to their bank by the authorities.  Anyone else remember that?

Winston Churchill's picture

They left the London branches of those Cypriot banks open for the oligarchs, only

serfs got caught.

tom a taxpayer's picture

I need help too.  I'm having a hard time seeing or understanding what this means:

…the Alpha Bank has submitted a request to the Bank of Greece for stimulating fluid through the ELA, the agent to invoke bank executive.


Is it rectal feeding?

"stimulating fluid'' = Draghi jizz?


StychoKiller's picture

Mangled by Google translator!

Winston Churchill's picture

Did you source that from the SNB ,or Benspankme ?

Joebloinvestor's picture

Bail in comes next.

Augustus's picture

That is the obvious next step.

Make it a 50% bail in and issue shares.

Then take the hit on the Greek bond writedown / haircut.  No reserves were required for those bonds as all govt debt qualifies as AAA for bank accounting.

Leaves the bank with maybe enough capital for the 10% equity requirements.

Bell's 2 hearted's picture

i tried to help


i ate out tuesday night and had a greek salad


uh, Greece gets royalty on that, right??

Bryan's picture

No.  Only if you have Greek sex.


Wait, did I just say that??

CrimsonAvenger's picture

Yep. And they get twenty five cents every time someone has anal sex. I frankly don't see why they need anything from the EU.

Winston Churchill's picture

Really, but now you know why greek gals are still 'virgins' when they get


knukles's picture

So that's why I never heard a Greek fart.

firefightergr's picture

I am Greek and i can assure you that at least 5 Greek women were not virgins when they got married.