Thursday, June 14, 2012

Greek Banks Under Pressure

Wall Street Journal
June 14, 2012

The owner of Greece's largest foreign-held bank is making plans to walk away from the bank if the country leaves the euro zone, the latest sign of growing international concern over the future of Europe's currency union.

The contingency plan for Crédit Agricole SA, France's third-largest publicly traded bank, comes ahead of pivotal elections in Greece Sunday that could set the country on a path to leave the 17-nation currency bloc.

A host of international companies have said they are preparing contingency plans, with many voicing concerns about how to retrieve cash in the country if Greece exits the euro zone. But none have disclosed potentially walking away from their assets in Greece.

In a sign of heightened nervousness within the country, depositors have been steadily increasing their withdrawals from Greek banks. The withdrawals, according to senior bankers in Athens, approach the level of deposit flight seen when government coalition talks collapsed after inconclusive elections on May 6, forcing the new vote.


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