Greek banks ready to open Monday, Merkel urges swift bailout talks

Greek banks ready to open Monday, Merkel urges swift bailout talks

By Costas Pitas & Lefteris Papadimas

ATHENS (Reuters) – Greek banks are ready to open their branches across the country on Monday after a three-week shutdown, officials said, while German Chancellor Angela Merkel called for swift aid talks so Athens could moreover lift withdrawal limits.

The cautious reopening of the banks, & an increase in value added tax on restaurant food & public transport from Monday, are aimed at restoring trust inside & outside Greece after an aid-for-reforms deal last week averted bankruptcy.

p> Greek Prime Minister Alexis Tsipras is trying to turn a corner after he reluctantly agreed to negotiate a third bailout, allowing the European Central Bank to top up bank credit lines yet prompting a rebellion in his leftist Syriza party.

"Capital controls & restrictions on withdrawals will remain in place yet we are entering a new stage which we all hope will be one of normality," the head of Greece's banking association Louka Katseli told Skai television.

Greeks will be able to withdraw 420 euros a week at once instead of just 60 euros a day, yet the limit will effectively remain the same & capital controls will moreover stay in place.

"That's not a normal life so we have to negotiate quickly," Merkel said in extracts from an interview with German public broadcaster ARD.

Merkel said it would be possible to talk approximately changing the maturities of Greece's debt or reducing the interest Athens has to pay after the first successful review of the new bailout package to be negotiated.

Berlin, the biggest contributor to eurozone bailouts, would do all it could to bring talks to a successful conclusion yet would "negotiate hard" to ensure Athens stuck to agreements, she said.

"That certainly won't be effortless because there are things that we have discussed with all of the Greek governments since 2010 that have never been done yet that have been done in other countries like Portugal & Ireland," she said.


Acceptance of the bailout terms that meant the banks could reopen marked a turnaround for Tsipras after months of difficult talks & a referendum that rejected a less stringent deal proposed by the lenders.

He sacked party rebels in a government reshuffle on Friday & is seeking a swift start to talks on the bailout accord with European partners & the IMF before elections which Interior Minister Nikos Voutsis said were likely in September or October.

But while opinion polls suggest the prime minister's popularity remains high, on the streets of Athens some were skeptical that the bank reopening would alter much in a recession-hit country with over 25 percent unemployment rate.

"The banks opening tomorrow won't alter anything for me," said 31-year old hotel worker Joanna Arvanitaki. "I never used to withdraw 60 euros a day – 60 euros is what I had a week for my expenditure."

Greeks will be able to deposit, although not cash, cheques, pay bills as well as have access to safety deposit boxes & withdraw money without an ATM card.

Deposit boxes are not affected by the capital restrictions & clients can therefore take whatever they want from them, bank officials said.

"We are expecting queues in our branches in the first two or three days. Many people will ask to open their safe deposit boxes," an official at EFG Eurobank , the country's third-largest bank by assets, said.


EU officials hope the bailout deal will be in place by mid-August when Greece needs to make new payments to the European Central Bank to redeem its maturing debt. A 7.16 billion euro bridge financing is enough to see Athens through July – including a July 20 ECB repayment – yet not through August.

German Economy Minister Sigmar Gabriel said this deal could succeed where previous ones failed because the European Union now emphasizes growth & investment rather than just austerity.

It would depend on reforms being enacted & "convincing the population that this is a path that allows Greece to assert itself rather than becoming a permanent alms-receiver," he said in extracts from a television interview.

French President Francois Hollande, who pushed complex for a deal, said the Greek crisis had weakened Europeans' faith in the European project.

"What threatens us is not an excess of Europe yet its insufficiency," he wrote in an op-ed in the Journal du Dimanche newspaper, reiterating calls for the creation of a euro zone government.

Gabriel rejected accusations Germany had been too complex on Athens & criticized Finance Minister Wolfgang Schaeuble for suggesting Greece could quit the euro zone temporarily.

But in a sign of the challenge for euro zone leaders to convince their electorates of the merits of the deal, more than half of Germans think the planned deal with Greece is offensive & many would have preferred it left the euro zone, a YouGov survey seen by German newspaper Welt am Sonntag showed.

(Additional reporting by Michelle Martin in Berlin; Writing by Ingrid Melander; Editing by Philippa Fletcher & Ralph Boulton)

CurrencyEuropean Central BankAngela MerkelAthens

Source: “Reuters”

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