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Capital Controls Loom in Greece – CNBC

It looks increasingly likely that Greece will have to implement controls to prevent capital flight and a banking collapse. To my mind, the only real question is when this will occur.

The widespread talk about Greece possibly leaving the euro zone is likely to trigger withdrawal of bank deposits and other financial assets, by those who fear they might be redenominated into a drachma that would be worth far less than the euro.

Foreigners have around 46.7 billion in deposits in major financial institutions in Greece. According to the latest data, there were around 1.3 billion of euros belonging to non-Greek euro-zone residents as of March 2012. In addition, there were deposits of 45.4 billion euros belonging to non-euro-zone residents.

via Capital Controls Loom in Greece – CNBC.

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