Savers shift money to safer havens
London, May 26, 2012
Greek savers may be gripped by a 'great fear that could develop into panic' in the words of President Karolos Papoulias, but many Greeks shifted their money to safer havens in Britain, Switzerland, Germany and Nordic countries long ago.
Worries about a run on Greek banks have rattled Athens this week, after savers withdrew at least 700 million euros ($876m) on Monday alone, according to minutes of Papoulias's comments to political leaders posted on the presidency's website.
It is not only Greeks who are worried about their savings. Data shows depositors have also taken flight from banks in Belgium, France and Italy. And on Thursday, Spain's Bankia was reported to have seen more than one billion euros drained by its customers in the past week.
Greeks are afraid they could be hit by rapid devaluation if the country leaves the European single currency, while customers at Bankia have been rattled by the government's takeover of the recently floated bank on May 9 and growing uncertainty about the final cost of Spain's banking reforms.
Greece's banks have lost 72bn euros in deposits since the start of 2010, or about 30 per cent, according to data compiled by Thomson Reuters.
'The entire Greek banking system is in danger: the banks are now facing the worst of all outcomes, deposit flight,' said Arnaud Poutier, deputy chief executive of IG Markets France.-Reuters