Greeks wait in lines to withdraw money from banks

The Greeks have withdrawn Monday from banks over 700 million euros, according to discussions between the president, Karolos Papoulias and party leaders, during which the President has sent a warning to the central bank, writes Reuters. The Greeks apparently withdraw money from banks because of fears of a rapid devaluation if the country leaves the euro area, reads the transcript of Papoulias’s negotiations with political leaders. The President gave them the information from the central bank chief George Provopoulos. “He said that there is a strong fear that can turn into panic. Withdrawals until 16:00, when I spoke to him, stood at 700 million euros. Provopoulos expects a total output of about 800 million euros,” said the head of the Greek state.

Greeks have been constantly withdrawing money from banks for months, but until now there were no queues at banks in Athens. Withdrawals of Monday far exceeded the rate at which the Greeks took money from banks since beginning of the debt crisis in 2009, notes the Wall Street Journal. In the last two years, the withdrawals usually ranged from 2 to 3 billion euros monthly, but in January exceeded 5 billion euros.

Greek head of state announced on Tuesday new elections in Greece, after the political parties have agreed to form a government because of opposition from some of them against austerity measures adopted in external financial aid packages. Surveys show that the radical left party and will get more seats than it won in the elections on May 6, a situation that has reduced confidence in Greece’s ability to remain in the euro area, hitting strongly the European stocks and quotations of the euro.

According to the latest central bank data, total deposits of companies and people in Greece amounted to 165.36 billion euros at the end of March. In late 2009, these deposits totaled 245 billion euros. EU political leaders and European Central Bank warned that they will stop foreign aid, which Greece desperately needed if the future government will not meet the commitments on austerity.