SKOPJE (Reuters) - Macedonia ordered its banks on Sunday to pull their money from Greek banks and imposed “preventive measures” to limit the outflow of capital to its southern neighbour, threatened by financial meltdown.
The move by Macedonia’s central bank followed an announcement by Athens that it would introduce capital controls and keep banks shut on Monday after international creditors refused to extend the euro zone country’s bailout and savers queued to withdraw cash.
The central bank in Skopje said the measures were “of a temporary character, introduced in order to address the danger of an eventual more significant outflow of capital from Macedonia towards our southern neighbour, that may cause significant disruption to the balance of payments and to the stability of the financial system.”
It said the capital limits would apply only to future transactions, not to arrangements already in place between Macedonian and Greek entities.
It ordered banks in Macedonia to “withdraw all deposits and loans from banks situated in Greece and their branches around the world.”
The statement was the first concrete sign of Greece’s immediate neighbourhood moving to protect itself from the financial turmoil threatening Athens.
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 1.6 billion euros payment due to the International Monetary Fund on Tuesday.
Greek-owned banks hold around 20 percent of total banking assets in Macedonia, and a significant share in the likes of Bulgaria, Romania, Serbia and Albania, raising the possibility governments may have to bail them out if the Greek banking system collapses and Athens leaves Europe’s single currency.
Writing by Matt Robinson; Editing by Ralph Boulton