Greece has seen enormous outflows from its banks, some 30 per cent of total deposits according to Reuters. These withdrawals accelerated prior to Sunday’s elections, over fears of a SYRIZA party victory and possible exit from the Eurozone.
This put added pressure on a banking system barely held together by the ECB and Greek Central bank.
After pro-bailout New Democracy won the election and formed a government with Pasok and the Democratic Left, Reuters reports that the deposit bleed is starting to reverse. A Greek bank that saw outflows of about 30 million euros a day in the days before the election saw an inflow of 15 million euros on Monday.
This is a good sign for Greece, but it mostly comes from small depositors who took the money home or put it in safe deposit boxes. Large clients that wired the money elsewhere in the Eurozone have yet to bring their money back. If they ever feel safe enough to do so, that will be an even better sign for Greece’s long term prospects.
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