Could Greece be the next in line for a bail-in?
Duncan Richardson, News Editor
8 Apr 2015, 10:25 a.m.
The Easter holiday has come and gone without the European Central Bank (ECB) imposing a Cypriot style bail-in. Greece managed to meet its end of month debt obligations, but the countries debt problems persist.
Two government treasury bills are due to mature on April 14th and April 17th totalling 2.4 billion euros, and the country needs to repay the International Monetary Fund 450 million euros on April 9th. The newly elected government have made it clear they are teetering on the edge of insolvency.
Worryingly, total bank deposits held in Greece is now just higher than the total amount of credit owed. When the Cypriot banking system reached the same point banks closed and customer money was confiscated and used to repay loans to the ECB.
So unless Greece can find new lines of credit, which seems unlikely the country could face Cypriot style bail-in. Importantly, Greece begins its four day Easter Holiday on April 10th which is sandwiched between these two critical debt repayments. Many are now forecasting the ECB will take this opportunity to confiscate customer deposits.