Anticipating calm at bank counters

This week starts under better conditions after the agreement of the Eurozone leaders on the extension and the repayment rate decrease by one unit. This decision, along with the PM’s definite denial about premature elections, relieved the Greek bankers who were very anxious last week due to the intense rumors about bankruptcy on March 25th.

The uncontrollable buzz of rumors, ranging from exaggerated to absurd, found fertile ground in a large part of minor depositors who rushed to the banks to safeguard their savings.

This phenomenon manifested itself very strongly on Thursday and particularly on Friday, and was dealt with mainly through the calm and reassuring attitude of the bank clerks, which reduced the outflow of deposits to only a few tens of millions.

The low outflow is due to the fact that the vast majority of depositors comes from retail banking and small savers who withdrew amounts from 1.000 to 10.000 euros most of which, the banks believe, will be returned in the following days.

Bankers estimate that the European agreement removes the fear of bankruptcy, along with phenomena of concern and an outflow of deposits, which showed a significant decrease especially in January.

The banks say it is a decrease that is statistically recorded almost every first month of a year and is not worrying. They add that the fact of small businesses, professionals and individuals withdrawing their money to cover their everyday needs should be of greater concern, while the wave of moving deposits to foreign banks has stopped for a few months now.

30 billion euros are gone…

However, according to official information from  the BoG, the Greek banking system has lost deposits of over 30 bil. euros from the beginning of the crisis until now. This amount is covered by the liquidity extracted from ECB.

According to the bank managements, the crucial point now is the punctual implementation of the memorandum and the transformation of the Greek economy, while focusing on fiscal consolidation and the strengthening of competitiveness for the alleviation of the depression and the return to growth.

Bankers estimate that everything will be judged by the government’s competence to plan and realize the politics necessary for the reinforcement of effectiveness. The utilisation of public real estate is the top priority in order to decrease the debt. A senior executive with extensive experience in privatizations indicates that the situation requires proper planning and an effective combination of priorities, decisions and deadlines.

The agreement of the 17 European leaders is a step forward, says a senior bank executive, but does not necessarily open the markets for the Greek banks. As he explains, the Greek banks are primarily affected by Greece’s lack of credibility and any progress in this field opens new paths to the international markets.

In conclusion, bankers stress the danger of a governmental and general political complacency after the recent agreement, a danger that could be proven fatal. “Relaxing and thinking we can afford the luxury of time is the worst that could happen. There is no time on credit here”, they remind us.