On January 9, 2015 I posted Another Run on Greek Banks Begins; Get Out While You Still Can; Buy Gold.
On the same day, Greek finance minister Gikas Hardouvelis said “Probability of a Bank Run is Small and Deposits are Safe”.
I propose Hardouvelis’ statement was one of those “lie when it’s serious moments“.
“Don’t Worry, It’s Only a Precaution”
The clear picture of which one of us is right emerged when two Greek banks requested Emergency Liquidity Assistance (ELA) from the Central Bank.
In another potential “lie when it’s serious moment” both banks said “It’s only a precaution“.
Greek Banks Request Emergency Liquidity as Outflows GrowÂ
Bloomberg reports Greek Banks Request Emergency Liquidity as Outflows Grow.Â
 Two Greek lenders asked to borrow from the nation’s central bank emergency line as deposit outflows already exceed 4 billion euros ($4.6 billion) this month.Â
Eurobank Ergasias SA (EUROB) and Alpha Bank (ALPHA) AE requested to tap the Emergency Liquidity Assistance, or ELA, said a senior Greek government official with knowledge of the matter. The request was filed following Bank of Greece instructions, according to officials at the two banks.Â
Both officials said neither lender plans to use the liquidity boost at this stage and the request was submitted based on the central bank’s estimate that they might need it over coming weeks. All three officials asked for anonymity because the matter is private. A Bank of Greece spokesman declined to comment.Â
Savers, seeking safety for their cash amid concern about the outcome of parliamentary elections on Jan. 25, are accelerating deposit outflows and draining liquidity from the country’s lenders. Net withdrawals were about 3 billion euros in December and have increased since then, thus exceeding 7 billion euros since speculation on snap elections began, according to a Greek official with knowledge of the matter.Â
Total deposits in Greek banks stood at 164.3 billion euros in November, according to the latest available data from the Bank of Greece. (TELL)
