Greece on the Verge of Collapse as Bank Run Looms

Greece entered a dangerous stage Sunday after the European Central Bank refused to raise the amount of emergency credit to help the country’s struggling banking system. Greek Prime Minister Alexis Tsipras said late Sunday that he had forced the country’s central bank to recommend that banks remain closed and restrictions be imposed on transactions.

Tsipras gave no details of how long banks will remain closed or what restrictions will be placed on transactions.

The Athens stock exchange will also be closed as the government tries to manage the financial fallout of the disagreement with the EU and the IMF.

Greek Finance Minister Yanis Varoufakis blamed Greece’s international creditors for failing to compromise saying,”We know that we have bent over backwards to accomodate the institutions, the troika, our European partners. They have not come to the party, they have not met us half way, not even a quarter of the way.”

Sunday’s move comes after two days of long lines forming at ATMs across Greece, following the PM’s call for a July 5 referendum on the latest cash-for-reforms package. Tsipras advised voters against backing a deal that spells further “humiliation”.

Morgan Stanley (MS) has put the chances of a Greek euro exit at 60 percent.

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