Greece Banking Sector To Face Crisis As Eurozone Meeting Breaks Down

Greece is facing a full-blown banking crisis after a meeting of eurozone finance ministers broke down in acrimony and recrimination on Thursday evening, bringing the prospect of Greek exit from the eurozone a step nearer.

As reports shows that about €2bn of deposits have been withdrawn from Greek banks so far this week – including a record €1bn yesterday – triggering fears that a breakdown in talks would spark a further flight of funds.

The German leader Angela Merkel, French president François Hollande and Greek prime minister Alexis Tsipras all agreed to stage an emergency EU summit on Monday as a last critical attempt to prevent Greece from going bankrupt. A representative of the European Central Bank told the meeting it was uncertain if Greek banks would secure the funds to be able to open on Monday.

The Luxembourg talks broke down within an hour of discussions about the Greek crisis starting, indicating the bad blood between both sides. Christine Lagarde, the head of the IMF, said there was an urgent need for dialogue “with adults in the room”. She added: “We can only arrive at a resolution if there is a dialogue. Right now we’re short of a dialogue.”