



Neighboring countries put Greek bank subsidiaries in quarantine in fear of contagion should there be an economic “accident” in Greece, a “Kathimerini” report said.

The central banks of Albania, Bulgaria, Cyprus, Romania, Serbia, Turkey and FYROM have all forced the subsidiaries of Greek banks operating in those countries to minimize their exposure to “Greek risk,” such as state bonds, treasury bills, deposits to Greek banks and loans.

As negotiations between Greece and its international creditors remain in deadlock and Greek state coffers are dangerously emptying, the possibility of default and a subsequent Grexit looms large. Continuous international media reports speak of Greece leaving the Eurozone, while in Greece certain cabinet members have openly expressed that the Greek economy can only recover out of the common currency.

“This quarantine was deemed necessary after the aggressive rhetoric of the new Greek government,” the report said. As the negotiations impasse continues, more and more statements from Greek officials speak of an inevitable collision with the creditors. Some analysts say that Greece’s stance in the negotiations seems like it is leading to a voluntary rift with creditors.

“Special care was taken for the subsidiaries of Greek creditors, which have a major presence in neighboring states, to make sure that they would not proceed to new positions in Greek bonds, t-bills, deposits in Greek banks or interbank funding,” according to “Kathimerini.”

Using the example of Cypriot-owned banks that changed hands overnight in March 2013 when Cyprus entered in a bailout program, the report concluded that “another concern for local bank groups is the threat of a reduction in the Greek element of their subsidiaries in neighboring countries in case of turmoil in Greece.”



