Thursday 29 September 2016

Greece crisis: Greek banks to stay closed for 'unspecified time', says Tsipras

Published 28/06/2015 | 20:54

Greek Prime Minister Alexis Tsipras is seen on a television monitor while addressing the nation in Athens, Greece June 28, 2015. Greece's European partners shut the door on extending a credit lifeline to Athens, leaving the country facing a default that could push it out of the euro and cause ripple effects across the European economy and beyond. REUTERS/Pool TPX IMAGES OF THE DAY
Greek Prime Minister Alexis Tsipras is seen on a television monitor while addressing the nation in Athens, Greece June 28, 2015. Greece's European partners shut the door on extending a credit lifeline to Athens, leaving the country facing a default that could push it out of the euro and cause ripple effects across the European economy and beyond. REUTERS/Pool TPX IMAGES OF THE DAY
People line up to withdraw cash from an automated teller machine (ATM) outside a National Bank branch in Iraklio on the island of Crete, Greece June 28, 2015. Greece's Prime Minister Alexis Tsipras on Sunday announced a bank holiday and capital controls after Greeks responded to his surprise call for a referendum on bailout terms by pulling money out of banks. REUTERS/Stefanos Rapanis

Greek banks will remain shut for an unspecified time and the country is imposing restrictions on bank withdrawals following a recommendation by the Bank of Greece, the country's prime minister has said.

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Today's move comes after two days of long lines forming at ATMs across the country, following Prime Minister Alexis Tsipras' sudden decision to call a referendum on creditor proposals for Greek reforms in return for vital bailout funds.

Greek Prime Minister Alexis Tsipras is seen on a television monitor while addressing the nation in Athens, Greece June 28, 2015. Greece's European partners shut the door on extending a credit lifeline to Athens, leaving the country facing a default that could push it out of the euro and cause ripple effects across the European economy and beyond. REUTERS/Pool
Greek Prime Minister Alexis Tsipras is seen on a television monitor while addressing the nation in Athens, Greece June 28, 2015. Greece's European partners shut the door on extending a credit lifeline to Athens, leaving the country facing a default that could push it out of the euro and cause ripple effects across the European economy and beyond. REUTERS/Pool

Earlier, the European Central Bank decided not to increase the amount of emergency liquidity the lenders can access from the central bank - meaning they have no way to replenish fast diminishing deposits.

"It is now more than clear that this decision has no other aim than to blackmail the will of the Greek people and prevent the smooth democratic process of the referendum," Mr Tsipras said in a televised address to the nation.

The referendum is set for next Sunday. But Greece's current bailout expires on Tuesday, and the 7.2 billion euro (£5.1bn) remaining in it will no longer be available to Greece after that date.

Without those funds, Greece is unlikely to be able to pay a 1.6 billion euro (£1.1bn) International Monetary Fund debt repayment due the same day.

Greek Finance Minister Yanis Varoufakis (3rd L) and head negotiator with Greece's lenders Euclid Tsakalotos (L) make their way past parliament as they head to Prime Minister Alexis Tsipras' office in Athens, Greece June 28, 2015. REUTERS/Alkis Konstantinidis
Greek Finance Minister Yanis Varoufakis (3rd L) and head negotiator with Greece's lenders Euclid Tsakalotos (L) make their way past parliament as they head to Prime Minister Alexis Tsipras' office in Athens, Greece June 28, 2015. REUTERS/Alkis Konstantinidis
Members of left wing parties hold placards reading in Greek ''NO'' next to a Presidential Guard, Evzonas, during a protest outside the Greek Parliament in Athens, Sunday, June 28, 2015. AP Photo/Daniel Ochoa de Olza)
Greek Finance Minister Yanis Varoufakis (C) and head negotiator with Greece's lenders Euclid Tsakalotos (L) arrive at Prime Minister Alexis Tsipras' office in Athens, Greece June 28, 2015. Tsipras on Sunday announced a bank holiday and capital controls in Greece after Greeks responded to his surprise call for a referendum on bailout terms by pulling money out of banks. REUTERS/Marko Djurica

Tsipras gave no details of how long banks will remain closed or what restrictions will be placed on transactions. Two financial sector officials said the banks would likely remain shut for several days.

A couple walks past a Eurobank branch near an advertisement at a bus stop in Athens, Greece June 28, 2015. REUTERS/Yannis Behrakis
A couple walks past a Eurobank branch near an advertisement at a bus stop in Athens, Greece June 28, 2015. REUTERS/Yannis Behrakis
People line up to withdraw cash from an automated teller machine (ATM) outside a National Bank branch in Iraklio on the island of Crete, Greece June 28, 2015. Greece's Prime Minister Alexis Tsipras on Sunday announced a bank holiday and capital controls after Greeks responded to his surprise call for a referendum on bailout terms by pulling money out of banks. REUTERS/Stefanos Rapanis
A man walks by a bank in Athens, Greece June 28, 2015. Greece's Prime Minister Alexis Tsipras on Sunday announced a bank holiday and capital controls after Greeks responded to his surprise call for a referendum on bailout terms by pulling money out of banks. REUTERS/Yannis Behrakis TPX IMAGES OF THE DAY

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