Greek crisis deepens – banks and stock exchange to be shut on Monday to prevent panic

Greek Prime Minister Alexis Tsipras announced late on Sunday that the country’s banks and Athens stock market will be shut on Monday and capital control imposed, to prevent withdrawals, after cash machines ran dry, local media shows. Moreover, the decision could be applied for the whole week.

This comes after international creditors refused to extend the country’s bailout.

Greece’s banks, kept afloat by emergency funding from the European Central Bank, are on the front line as Athens moves towards defaulting on a EUR 1.6 billion payment due to the International Monetary Fund on Tuesday.

Prime Minister Alexis Tsipras said the decision to reject Greece’s request for a short extension of the bailout program was “an unprecedented act” that called into question the ability of a country to decide an issue affecting its sovereign rights.

Ahead of the announcement, Greeks raced Sunday to find functioning cash machines in an increasingly anxious run on the banks, as speculation mounted over impending drastic restrictions.

“It’s more than obvious that this (Eurogroup) decision has no other goal than to blackmail Greek people … and to raise obstacles to the democratic process of the referendum. People’s deposits are safe, totally safe. Equally safe is the reimbursement of salaries and pensions. Any difficulties that may arise must be dealt with with calmness. The more calm we are, the sooner we will get over this situation,” Tsipras said in a statement.

Around 40 percent of all cashpoints in Greece have run out of cash, sources say.

The debt negotiations broke down over the weekend after PM Tsipras said he would let the Greek people decide whether to accept the creditors’ latest offer. That referendum vote is to be held next Sunday, after the current bailout program will have expired.