May 16, 2012
Greeks are voting with their wallets and pulling euros out of the banks in fear that their country may leave the European single currency despite the declared determination of EU powers Germany and France to keep Athens in the monetary union.
Central banking sources said the European Central Bank has stopped lending to some Greek banks because they had not been successfully recapitalized. The sources did not name the banks but said they have to go to the Bank of Greece for emergency liquidity assistance. The ECB declined comment.
As financial markets shuddered over the deepening turmoil in Athens on Wednesday, governments of other troubled euro zone states from Spain to Ireland voiced concern about the impact on their own shaky finances.
Spanish Prime Minister Mariano Rajoy told parliament his country faced trouble financing itself as borrowing costs shoot up to "astronomic" levels. Irish Finance Minister Michael Noonan said Dublin's plan to return to capital markets in late 2013 might not be achievable because of the uncertainty.
A chorus of skeptical politicians and central bankers from London to Ottawa predicted the euro could fall apart unless European governments act more decisively to save the currency.
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