Countries in southeastern Europe are preparing for a possible bankruptcy of Greece, reported the Greek newspaper Kathimerini last Friday, 17th of April.
According to the newspaper, the central banks in Balkan states Bulgaria, Albania, Romania, Serbia, Cyprus, Macedonia and Turkey, obligated the local subsidiaries of Greek banks to repel portfolios with Greek bonds and loans. This measure practically puts the Greek banks in a state of quarantine.
The four largest Greek banks National Bank of Greece, Alpha Bank, Piraeus and Eurobank have a strong presence in these countries with 2,500 branches and 40,000 employees.
The Greeks themselves seem to be increasingly concerned about the financial future of their country. They pull their bank accounts empty rapidly. In March, Greeks took another 5.5 billion euros of their bank accounts after too many billions have been recorded in previous months.
At the end of March there was for about 135 billion Euros in Greek bank accounts. According to Kathimerini, Greeks now have about 15 billion Euros still on the accounts.
Potential effects for FBME bank customers
During recent months many FBME bank customers from Cyprus opened via their intermediary or offshore service provider a second bank account at National Bank of Greece, Alpha Bank, Piraeus or Eurobank. Although the Greek government tries to avoid its bankruptcy, the IMF, EU and Tifkat (The institutions formerly known as troika) thus far refuse to add flexibility as long as the current commitments are honored with difficulty and the left wing politicians even want to reverse the existing agreements.
FBME customers with Euro accounts are able to withdraw, via a complex route, 200 Euros per day. A check can be issued by FBME, on a Bank of Cyprus account since its own payment system is shut down completely. This check must be deposited on the account of the beneficiary at another bank in Cyprus. FBME customers who already use this route and have their second bank account at National Bank of Greece, Alpha Bank, Piraeus or Eurobank, need to investigate this situation with absolute scrutiny. One bank failure is enough, having a second one will mean an absolute disaster.
Preparations for a hard landing
It seems crystal clear that one has to protect himself against numerous negative outcomes. The Greek tragedy is again another step in the difficulties experienced with FBME bank. It keeps on adding up.
If you would like more information about recent developments within FBME, or if you are interested in a personal discussion of the possibilities in your individual case, and need advice on how to prepare yourself for different scenarios, please contact the FBME Bank Account Rescue Mission.