Grexit: Not reaching a deal would be “insane”, says National Bank of Greece boss Louka Katseli

Lynsey Barber
Follow Lynsey
The chair of National Bank of Greece has spoken about Greece's debt situation (Source: Getty)

The boss of Greece’s biggest bank has said it would be “insane” for the country not to reach a deal at emergency talks due to be held tomorrow between the Greek government and European leaders.

Louka Katseli, the chair of the National Bank of Greece (BNG), told the BBC "I think sanity will prevail and an agreement will be made".

"If there is no agreement sooner or later the liquidity shortage in Greek banking system will become severe," she warned.

Katseli said banks were not under immediate threat of running out of money.

Greek ministers will try to put new proposals to creditors in debt deal negotiations in a bid to break a deadlock which risks the country defaulting and leaving the Eurozone.

Greek Prime Minister Alexis Tsipras informed EU leaders of the new proposals in a call on Sunday, ahead of Monday's emergency talks.

The European Central Banks offered a lifeline to Greece on Friday increasing the amount of emergency liquidity its banks can draw on for the second time in a week, after negotiations broke down.

Tsipras and European Commission President Jean-Claude Juncker have held talks over the weekend, according to reports, as they seek to avoid default on a €1.6bn (£1.1bn) loan repayment to the International Monetary Fund (IMF) due on 30 June.

Read more: Countdown to Grexit: The key dates that could save Greece before bailout deal expires

Katseli told the BBC's World at One that negotiations had been badly handled with a "lack of leadership" from the European Union side.

She said she believed Greece would not be forced to leave the euro because of the cost to the region. "If the markets decided the eurozone is not an irrevocable decision and a government can be declared insolvent, then the first thing that would happen is that there will be a speculative attack by the markets on the next weakest participant in the eurozone or the euro."

On Friday, Katseli called for Greeks to act responsibly in regard to withdrawing cash. More than €4bn has been withdrawn over the past week, according to reports.

Related articles