This page has been archived and commenting is disabled.
Greece Suffers Biggest Bank Run In History: January Deposits Plunge To 2005 Levels
One of the biggest question marks surrounding the Greek negotiation and ultimately, bailout extension, was just how panicked was the Greek population and domestic corporations. Recall that as explained previously, the tension boiled down to this: the Troika did everything in its power to accelerate the bank run in order to crush any negotiating leverage Varoufakis may have; Greece on the other hand was desperate to make its cash drain appear far better than rumored.
Moments ago the Bank of Greece presented its latest, January, deposit data. And it's a doozy: following a record €12.2 billion monthly outflow, greater in absolute and relative terms than anything experienced during any of the previous Greek crises and bailouts, the total amount of Greek corporate and household deposits has now tumbled to just €148 billion, down 7.7% from the month before, and down 10% since November. This number is in line with some of the more pessimistic expectations, and brings the total cash holdings at Greek banks to the lowest level since August 2005.
What's worse is that the outflow has most certainly continued in February, when according to rumors another €10 billion or more may have been withdrawn. And while the new FinMin is desperate to make it seem that now that Greece has a can kicking bailout extension "deal" the bank run has stopped, this is very much in doubt.
One thing is certain: Greek banks, already crushed by record NPLs somewhere in the 40% range, and without any equity buffer, are now all, without exception, dead banks walking following this latest cash rush. And absent another bailout - one which S&P calculated in October will need to fund Greece with more than €40 billion in additional cash - and one which will come with even more draconian conditions, we simply don't see how Greece gets away from its current "self-reinforcing feedback loop" predicament without Cyprus-style capital controls.
»
- 17298 reads
- Printer-friendly version
- Send to friend
- advertisements -
Looks like the Euro may dive through a key resistance point....
BTFDax - It's the only game in EuroTown
We just learned from JPM and others that banks don't rely on deposits anymore. The business model changed :)
Far from it, a deposit is a liability.
It would be intersting to know who are the (foolish/ somehow coerced) depositors
Greeks may be dumb, but they're not stupid.
the chart says that there are still 150 Billion E, in the banks, thats a strong case to the contrary.... They should draw it down to Zero and leave the gernans with the bill.
Interesting. Who if anyone is on the hook if there was (is) a Greek bank run to the point that all of them are broke? Is anything backstopping them? Assumedly its ultimately the ECB, so who would end up forking over the dough and most importantly, what happens if they dont?
With zero interest rates, bank are a thing of the past. Why should a saver put his money at risk for nothing or in Greece for the danger of immediate confiscation?
Something else is at work in EUR. Hard to call it on Bullard comments and US data only.
F I've been trading both directions for nothing R/R and it's been a great short today.
And why exactly should this bank run surprise anyone? You didn't need to be a Nostradamus to get this one right, now would you?
I saw it in the tea leaves a while back. They also told me to ask Janet out this weekend!
She might let you touch, err ... read her entrails.
Yes. Why is there any money left in Greek banks?
Cypress is in the neighborhood, right?
What's the big deal about having the same amount of deposits as in 2005, it's not like they're printing just money or something...
Moreover, I think Greece was doing just fine in 2005 (if only in their own and everyone else's minds), so perhaps this problem is a figment of the banker's imagination...
Speaking of Cyprus:
Cyprus signs deal to allow Russian navy to use portshttp://www.bbc.co.uk/news/world-europe-31632259
My sister and her Cypriot in laws are still using the same banks that gave them a haircut.
Something about stupidity being infinite is on the tip of my tongue.
yeah, i'm with you here.. why the fuck do these people have more than a token amount of change in the banks anymore AT ALL?
then again a lot of these deposits are firms and not actual humans, who have to do business using banks (indeed they are even forced to by laws in the recent years), so they are SOL when it comes to independence from the banking cartel...
but i also don't see what is so bad about LETTING THE BANKS FAIL! really! just let the banks go bankrupt... anybody stupid enough to have not gotten his money out by now... well, loses it, but without capital controls, without a cyrpus, just with an old fashioned bakruptcy.
icing on the cake would be to arrest anyone in the management or officers of those banks in the past 20 years, dissolve the corporate entities entirely and scatter the ashes to the 4 winds, annul debts owed to them just as deposits were corzined away in a previous round, and basically just shut the whole effing sector down. let people exchange directly without needing any middlemen.ok, that's all just icing on the cake. letting them go bankrupt and letting them shut down is a necessary step towards solving this mess.
Cyprus is actually the very island where so many Greek banks made huge losses, and so caused so much of this mess in the first place
The greeks still have cash? In banks no less...
the Germans keep handing it to them - who are the real idiots ?
It would be interesting to know how much BuBa is on the hook for Greek overdrafts in the Target 2 system.
Well they think they do anyhow.
Laws, you won't believe how much cash eurozoners in general and Greeks specifically have. Remember that we have a need for 500 EUR notes. We are the continent where houses are bought and sold with cold paper cash only
Spoken like the proud currency destroyer that you are. Your love for statism is well-establish Ghordius. Let the Greeks "fix" Greece already. Like so many statists I still can't get a straight answer as to whether or not all this debt actually matters.
tick tock.
FYI, you don't think homes are bought and sold for cash anywhere else? You are a first class idiot.
what happened to the half-civil grumpy old man? are you someone that took over his account?
of course houses (damn this gay "homes" Americanism) are sold in many places in cash, or gold, in Vietnam and other places
where the FUCK is this stateless territory from where you are writing from? tell me and I'll join you
and please tell me where I expounded a particular love for statism. in my book, it's a necessary evil
tell me you pay no taxes whatsoever to any country that has military bases abroad, you hypocrite wishful dreamer of statelessness. you are part of the problem
Can't we all just get along?
"You can't fight in here... this is the War Room!"
Sure.
How much money would you have if you never paid taxes?
You say that like it's a bad thing...
Bullish.
What amazes me is that any Greek has a single Euro on deposit in any Greek bank--what the heck are they thinking?
I know, I know. I've been beating that drum around here for the last 3-4 weeks. I'm done. When they slam the doors shut you can be certain there will still be plenty of people angry and upset. "They stole all the money I had in the world! How could they do this? Nobody told me this could happen!"
You can't fix stupid.
Normalcy bias. Never happened in their lifetime, so it can't happen, simple as that. And you are the tin foil hatter, NoDebt. Until it finally does happen. I was once that gullible myself. Until 2008 gave me one hell of a WTF-come to Jesus-moment. So I still feel some compassion for those people.
bad assumption - that those people care to or want to think
then again the average greek doesnt have a balance more than a couple hundred bucks anyway, and that is probably because if he still has a job he is being paid into a bank account. honestly i can't name anyone i know who has even a thousand bucks in the bank, but a number of friends etc have balances that might be between 50 and 150 bucks on average. i warned one friend to get any money out , 2 weeks ago, and the response was, i have 80 euros in the bank, what are they going to steal from me' .. my reply was '80 euros' but , i suspect most of the deposits left in greek banks are held by firms and not people.
A couple of things:
1. As others have pointed out, could be a case of normalcy bias; or related to this,
2. What are their viable options? Deutsche Bank, SocGen, Dexia? Talk about out of the pan and into the fire.
3. Are data from Bank of Greece any more trustworthy than data from another CB?
4. More likely, the bulk of what remains are transactional balances of businesses (payroll, daily receipts, etc.). I suspect most households are only keeping token balances in a bank, but this is only a suspicion--see #3 above.
The Euro is dying. Just a matter of time before everyone realizes it and positions appropriately.
OMG there's still 148 billion in deposits!!! The phrase "Sense of urgency" comes to mind...
"Sense of urgency" you must be a leader.. You talk the talk
We gotta remember this is a country of just 10.8 million people so 148 billion in deposits left surprised me. People better get a running...
"tumbled to just €148 billion"
only when it reaches 0 will I get excited
It could be adjusted to zero without any notice.
or 1480 billion - all depends on which direction TPTB feel like moving/typing-in the decimal point
this is obviously why Gold and Silver phony paper markes r being forced down in the last hour of trading in that shithole of financial fraud London....
http://www.kitco.com/charts/livesilver.html
again.
the smackdowns will continue until morale improves
you meant - "the smackdowns will continue until there is no more physical to be bought or sold..."
there i "fixed" it 4 ya...
thanks (dead-on) - they will do it until they can't
More like ... "...no more physical to be delivered."
Local coin-store guy told me recently that he's having no issues restocking at current prices. If they knock back under $15 though, I expect to see premiums rise back up as phys starts getting scarce again.
Garanimal turns to Grexit? Someone has size to go. 1.1170??
My gut tells me there is more two way 'action' left today with the downside bias.
Just guessing but looks like a bail-in no longer looks profitable. The Greeks I know turned to real momey a long time ago.
All thanks to Herr E. Koch.
Get those euros out and buy Danish krone. Stupid!!
Pssst...(gold bitchez).
Banks are private companies, they (should) go bankrupt.
Goodbye.
the London last hour pump of the Fraud markets has commenced....
i most be a genius for being able to predict this every day for a year now.....!
I did not think banks had reserve requirements anymore? That seems old fashioned? Can't Brussels just keep sending trucks to refill the ATM's?
They can and do, --well, maybe not ATMs literally-- but the hidden black hole of collapsing derivatives, leveraged to amplify the tiniest change, keeps nullifying the effect.
What's the big deal? The banks have the deposits, they just return them. Right?
Good. Who needs private banksters I mean banks.
I'm ready for some new headlines, this "Greece" thing is getting old !!
yea, right? too bad it seems to be one of the most controversial topics right now.
Where in the fuck are Mortimer and Randolph Duke when you need them?
KC Fed +1 FIGURES!
"No one saw this coming."
No worries; the Big Fish will never miss a 7-course dinner with fine wine and champagne.
This is not true. I remember in 2012 they were saying deposits were down to 90bn. That's why they were paying high interest rates (4-5%.) Now they are just giving a 1.8%...
These threats and ultimate effects of bank runs are really, really overblown, particularly during an era in which banks are not loan institutions anymore, anyway -- and especially not for the average citizen.While larger entities will always be able to find outside funding, one way or another. For example, and as the world will no doubt soon understand, there's nothing to stop Greece and its native corporations from offering bonds denominated in yuans or rubles... In fact, if it were to shrug off its EU burden, it would/will become instantaneously solvent, with ample resources to back its new currency within the new BRICS trading platform.
by the way, do a youtube search for the superb new German-metal hit, 'V for Varoufakis' : ) hilarious
WHO IS DOWN TO GO BUY SOME GARANIMALS WITH ME TODAY? - AND I AM DEAD SERIOUS. I'm getting leopard, tiger, and fox. Yeah, baby, yeah.
Don't the banks need to have money in them for there to be a run? Which fool would have more than short term pocket change in a Greek (or any) bank?
Fools of the wealthy persuasion. The little people ceased to matter in these circumstances some time ago.
Greek gov currently consulting with Cor-zine on how to handle the remaining deposits...
Don't tell Gerald Celente. He will get super pissed.
Imagine that, nobody believes the Pols that everything is "just fine and manageable". Maybe Emperor Goebbels can go on TV and tell them the U.S. "has their back" and they shouldn't worry; yea, that will calm them. Tragedy and Comedy at the same time.
www.traderzoo.mobi
Well they didn't have access to their celebrity politicians... and they were unable to express the mandate for these political negotiators... so
They might consider hanging or killing these new leaders...and emphasizing their mandate.
I'm just saying... if you want sovereignty or to default you gotta kick ass.
If the politicans say that everything is fine then that's good enough for me. Too many cynics around....
Bitcoin has been at $238 for days now and I refuse to report on it until it changes.
>>>
we simply don't see how Greece gets away from its current "self-reinforcing feedback loop" predicament without Cyprus-style capital controls
<<<
More ELA, which it will get (despite the tough talk) until Merkel is removed from the decision-loop.
Watson
And the greecy, slippery slope keeps tripping: http://prestonclive.whotrades.com/blog/43963995732
Isn't the following true?
Greece's admittance to the EU was based on fraud. Specifically the use of currency swaps which enabled Goldman-Sach, as Greece's consultant, to cook the books to make Greece's debt/GDP ratio fall within ECB guidelines.This was common knowledge amongst all of the EU nations so it was no surprise that Greece could not fulfill obligations required by the EU and the ECB.
This no surprise. Goldman-Sachs made billions of dollars advising Greece which lead, directly, to the disaster which unfolded within a few years after this fraud was committed.
Goldman-Sach will be the downfall leading to the end of capitalism and the new dawn of fascism. Since Goldman is the culprit, yet again, why don't we (the world) hold yes moneychangers responsible for the havor they create?