Banks: Watching a bank run in Greece…..


We have previously written about keeping a firm eye on deposit flows in the Greek banking system. With election results only a few days, the implosion of bank share prices is not encouraging…

The scorecard today reads as follows:

1. The quoted Greek banks’ share prices are down on average by 40% since the election on Sunday.

2. All of the banks today are down more than 20%; this is their worst day ever and Greece has had plenty of bad days.

3. The Greek bond market is getting monkey hammered; 3 year bond yields are over 16%.

4. Bank of Piraeus share price has imploded 46% in just 3 days.

Current market commentary suggests bank shareholders don’t like the sound of a leftist approach to government starting with the suspension of planned privatisations under Troika agreements.

WealthiFi would suggest that anybody holding any significant domestic bank deposits won’t be feeling very comfortable in a fast-developing quasi-Marxist political environment. On that basis, are the bank share price collapses reflecting an underlying capital flight? If so, things could get very interesting very quickly.



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