Greek Central Bank Warns Country "Unlikely To Survive Another Bout Of Instability" As Bank "Jog" Accelerates
Something unexpected happened on the road to the latest Greek "recovery": the local population no longer believes one is coming.
As Greece remains crippled by unprecedented capital controls preventing full access of the local population to its savings as a result of last summer's "referendum" and third bailout fiasco, and as Greek Prime Minister Alexis Tsipras braces for another round of tough negotiations with creditors, "savers are still reluctant to bet their money that this year’s talks will be less perilous for their country’s place in the euro area than 2015", as Bloomberg puts it.
A less diplomatic way of saying it is that while the bank run has been forcibly stopped, the bank "jog" continues.
According to the latest Greece’s central bank data released this week, deposit outflows continued in November for a second consecutive month, even as the nation’s lenders plugged their capital shortfalls, and strict capital controls put in place last summer capped withdrawals and money transfers abroad.
Deposits held by households and businesses in Greek banks fell close to a 12-year-low of 120.9 billion euros ($131.3 billion) in November, bringing total losses to a record of more than 43 billion euros, or 26.4 percent of total savings, in the last 12 months.
Back to Bloomberg which says that the "savers’ distrust may derail the government’s goal of lifting capital controls by the end of June. Reluctance to return deposits held abroad or under mattresses back to banks hinders the ability of lenders to provide credit to the economy, as the government struggles to lead Greece out of recession in 2016 after a turbulent year which pushed the country to the verge of leaving the euro area."
This was reflect in separate data also released by the Bank of Greece which showed that private sector deleveraging picked up pace in November, with outstanding loan balances dropping 2.2 percent from the previous year. Credit contraction “returned with a vengeance in July, continued unabated in August, slowed in September, yet picked-up speed again in October and November,” Athens-based Pantelakis Securities’ analysts Paris Mantzavras and George Grigoriou wrote in a note to clients on Thursday.
It appears that after letting down his constituency at every possible turn, the Greeks no longer have trust or faith in their prime minister.
Even as Tsipras assures savers that the country’s banks are now among the most adequately capitalized in Europe and there’s no risk of haircut or re-denomination for deposits, Greeks are still unwilling to bring their savings back, as the government remains at loggerheads with creditors over demands for additional pension cuts. Pension savings is among the main conditions for unlocking Greece’s next aid tranche and for debt-relief talks between the country and its euro-area creditors to begin.
Meanwhile, In an article in Sunday’s Kathimerini, Bank of Greece Governor Yannis Stournaras underlined the importance of Greece’s Parliament approving measures agreed with creditors for the third bailout, including reforms to the pension and tax systems, and warned of the risks of a new period of “backsliding.”
According to Kathimerini, failing to successfully complete a review by creditors in the coming weeks could trigger a new bout of instability that Greece is unlikely to survive, according to the central bank governor who served as finance minister from July 2012 to June 2014.
"A potential failure to complete the review would have a destabilizing effect, bringing back to mind the negative experience of the first half of 2015,” he wrote, referring to a period of high tensions and political and financial uncertainty.
Stournaras desperately pleaded that "it is the key for the return of deposits to the Greek banking system and for the launch of discussions with partners on a series of positive actions."
So far the population refuses to cooperate.
In what has become an annual ritual, it appears Greece is about to break, all over again.
(8 votes)
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Google/Alphabet should buy Greece - great place to hang out and get a tan when out of the Cali offices.
Spot the problem anyone?
"please deposit more money into the bank while we cut your incoming cash flow"
I will begin holding my breath..............now.
You won't go to the casino with my currency anymore, fuckface. Gold & silver chips is my game.
And the Greeks will never pay taxes again...that is the big hurdle for any government....if they had any income..its out of country now....and paying taxes and bills is so old school....but of course they want their pensions...
Hmmm. Feed they family and pay the bills or die and make the Central bank happy????????
Greek bankers must have bodyguards. Otherwise, they'd all be dead.
"No, really Honey, I've changed...
I know I hurt you but this time it's gonna be different...I swear."
Relax, all Greek citizens are going to fill out the precious metals and stones declaration form with their next tax return. We got it covered!
On the Road to a Greek Recovery- A madcap romp where 3 ex Goldmanite bankers asset strip and enslave the entire Greek population as a prologue to other road movies culminating in the grand finale of On the Road , A World Tour. Casting to replace Hope, Crosby and Lamar begins this spring.
Greece has been hanging on by their fingernails the whole time. The amazing thing is ... the behavior never stopped. Tbe poor people and the pensioners got screwed. But the rich just kept hiding their wealth, paying no taxes, covering up their swimming pools in their backyards, and pretending that the game goes on forever. They really don't care about their own country.
Greece is headed towards a takeover by an extremist government.
Or the military.
Or both.
"Greece is headed towards a takeover by an extremist government."
What the fuck do you think they have now in Greece, ffs? They can put any label they like, the FACT IS they are Stooges of the BANKSTERS. ALL OF THEM. From Golden dawn to KKE. They all LOVE TO BE IN THE EURO Trough
Only one I can see is for "OUT OF THE EEC AND THE EURO".
it is EPAM.
Guess what, they are NOT ALLOWED AIR TIME. Does that tell you something??
DEFAULT HERE AND NOW.
I will personally take the first plane to Greece to enjoy the Chopping of the head of Stournaras. I am prepared to pay big money for first row seating.
they've got Tsipras and a Stooge government, yes. But when a real extremist government takes over, they will shoot a few people, default on all debts, and plunge the country into rampant hyperinflation.
default now
The picture at least shows who coppers worldwide serve and protect
what is this "country" you are talking about?
yeah, give us all your money to keep in the banks, it'll be different THIS time, just see, you can trust us now, it was all a little misunderstanding before...
Greece fucked up. They should have continued to shove Yannis Varoufakis down the German's throats until they puked up a better deal.
But no, at the last minute Tsipras honks and takes it right up the ass...at least we know why they call it "greek".
Varoufakis wanted to go "full retard" and reintroduce the Drachma, it was the only real way out. Knowing Varoufakis, he pro'ly would have wanted full reserve, non debt based currency.
somebody twisted Tsipras' arm in a major way. you're right ... the previous strategy was working better for the Greeks.
Reichstag Fire Department: Knowing Varoufakis, he pro'ly would have wanted full reserve, non debt based currency.
How about an example of a "full reserve, non debt-based currency." Where can one be found now. Where has one ever existed?
And why do you talk of currency? It's just one form (circulating script) of money. There are also coins ... and bookkeeping records which are also forms of money.
Money is just an invention allowing simple barter exchange to span time and space. What does reserves have to do with it? And of whose imagination is that a figment?
The european mass media suggested in numerous articles (probably written by the same troll) that Greece will recover as soon as Tsipras makes the Greeks pay the overdue taxes. We are all waiting now for confirmation that it happened and that it did work - but it won't. Greece is very unlikely to recover. The real state of affairs is certainly much worse than generally acknowldged by EU officials. Even a significant debt reduction will not lead Greece out of the recession. Tsipras fucked it finally up. Charisma alone is not enough.