Anxious savers withdrew €12bn (£8.8bn) from Greece’s banks in January, underlining the desperate challenge facing Athens’ anti-austerity ministers during last week’s debt talks.
Figures for February are not yet available from the European Central Bank, but the exodus is likely to have continued after the Syriza-led coalition came to power, and battled to secure a four-month extension on its €172bn bailout loan.
With the ECB offering only limited support to Greek banks under the emergency liquidity assistance (ELA) programme, the scale of the capital flight suggests Athens had to strike a deal last week to halt a bank run that could have endangered the country’s financial system.
Its finance minister, Yanis Varoufakis, who led last week’s Brussels negotiations, eventually secured an agreement in principle on extending emergency funding for Greece. On Thursday, he boasted that deposits had since flooded back into the country.
“There was a deposit flight back into the Greek banking sector,” Varoufakis told Bloomberg TV. “It’s a question of direction. Once you turn the tide, you hope.” He added that €700m was deposited at Greek banks on Tuesday alone.
The extension deal on Greece’s loan requires the government to submit a list of economic reforms it plans to carry out. It has yet to be formally approved by the German and Greek parliaments, but is expected to pass.
But with some leftwing Syriza parliamentarians expressing doubts about the compromises involved and with the German finance minister, Wolfgang Schäuble, taking a tough line, Greece still faces tough challenges in the coming months.
He said on Wednesday: “It’s not easy for Greece, but it also isn’t easy for others. Nobody can live permanently beyond their means.”
