Thu | Sep 21, 2017

Greece Faces Banking Crisis

Published:Friday | June 26, 2015 | 6:00 AM
Managing director of the International Monetary Fund, Christine Lagarde (left), greets Greek Finance Minister Yanis Varoufakis during a meeting of Eurozone finance ministers in Brussels yesterday. Greece and its creditors launched a new round of talks in Brussels early yesterday in a fresh bid to unlock billions of euros in loans and save the country from bankruptcy.

Greece is facing a full-blown banking crisis after a meeting of eurozone finance ministers broke down in acrimony and recrimination yesterday evening, bringing the prospect of Greek exit from the Eurozone a step nearer.

Some €2 billion of deposits have been withdrawn from Greek banks so far this week - including a record €1 billion yesterday - triggering fears that a breakdown in talks would spark a further flight of funds.

The German leader, Angela Merkel, French president Francois Hollande and Greek prime minister, Alexis Tsipras, agreed to stage an emergency EU summit on Monday as a last critical attempt to prevent Greece going bankrupt. A representative of the European Central Bank told the meeting it was unsure whether Greek banks would have the funds to be able to open on Monday.

As thousands of pro-EU protestors gathered outside the Athens parliament building, leaders of the eurozone and the International Monetary Fund aimed bitter criticism at the left-wing Greek government, accusing it of lying to its own people, misrepresenting and misleading other EU leaders, refusing to negotiate seriously, and taking Greece to the brink of catastrophe.The Luxembourg talks broke down within an hour of discussions on the Greek crisis starting, indicating the bad blood between both sides. Christine Lagarde, the head of the IMF, said there was an urgent need for dialogue "with adults in the room".