Banks man battle stations to combat deposits outflow problem

Worry levels rise as bankers now face the possibility of massive outflows of deposits from their coffers after yesterday’s failed Eurogroup.

Banking sources estimate that today will be the toughest day in the war of deposits outflow which has lately become a torrent. It is characteristic of the situation that this week began with withdrawal of deposits up to 300 million euro and has risen to an “open wound” reducing deposits by 1 billion each day. Three billion had been withdrawn between Monday and Thursday.

1.1 billion euro of the ELA given by the ECB on Wednesday proved insufficient before the wave of outflows. According to sources, BoG Director Yannis Stournaras has already presented a formal request of emergency liquidity of 3 billion in order for banks to manage on Monday, the day of a crucial summit.

Even though BoG sources denied such a piece of information, it seems that the ECB will agree to Greece’s request in order to avoid any capital controls to the country’s banking system prior to the Summit.