Brussels---With Greece's creditors refusing to extend its bailout, attention has turned swiftly to preventing massive capital flight as worried Greek citizens pull cash from ATMs.
Fears that the banks may not open Monday have prompted the European Central Bank to meet but officials say it will be up to Greece to stem an outflow that has already reached dangerous levels.
"If there isn't capital controls by Tuesday at the latest, it's over," said a European source close to the negotiations.
"Greek banks are near liquidation and can no longer remain solvent. Once the banks fail, 'Grexit' will become irreversible," the source said.
Talks on Saturday collapsed with the Greek contingent leaving the remaining 18 eurozone ministers to consider the consequences of a default.
In a statement, the ministers appeared to urge Greece towards capital controls, saying that the expiry of the bailout "will require measures by the Greek authorities, with the technical assistance of the institutions, to safeguard the stability of the Greek financial system."
The withdrawals today were "exceptionally high," warned the influential German Finance Minister Wolfgang Schaeuble at the talks on Saturday.
Faced with this calamity, Natixis analysts Jesus Castillo and Alan Lemagnen said the Greek government could decide a bank holiday, an order that the nation's banks remain closed to avoid a run by customers.
Similar moves were made in 2013, when Cyprus imposed drastic limitations on cash withdrawals and money transfers abroad when its banks faced crisis -- in large part due to contagion from the crisis in Greece.
AFP
