Greece: Lifting of capital controls

It is worth noting that in the first seven months of 2019, bank deposits have increased by slightly over EUR 4 billion. 

Beyond that, the yield of the ten-year Greek government bonds fell from 4% - 4.5% to below 2%, and in this climate it is expected that the removal of capital controls will be a positive psychological factor. As such, some Greek savers abroad might be persuaded to bring their savings back to Greek banks. 

Similar behavior is expected to be shown by private savers and businesses, which have since the beginning of the year uploaded their deposits to Greek banks. In fact, this trend is much higher than it appears on numbers and papers. In particular, during the first half of the decade, large companies rushed to use the ceiling on their credit lines, borrowing large sums, which were then deposited abroad. In this way, they not only had assured liquidity in the event that banks stopped new lending, but could at the same time continue their operations smoothly in the event of capital controls.

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