Greek Banking Crisis

About Greek Banking Crisis

Greek banks were at the center of the Greek debt crisis. Greek banks held large amounts of Greek government bonds. When Greeces debt was restructured in 2012, bondholders took a 53 percent haircut, devastating bank balance sheets. Banks were recapitalized with bailout funds three times. In 2015, when Prime Minister Tsipras called a referendum on bailout conditions, the ECB restricted emergency liquidity. Greek banks closed for three weeks, imposing capital controls. Depositors could withdraw only 60 euros per day. The crisis destroyed 25 percent of Greek GDP. Greek banks were consolidated into four major institutions. Non performing loans peaked at 45 percent of total loans.