Full Abolition of Capital Controls on Cash Withdrawal Credit-Positive for Greek Banks, Moody's Says

Full Abolition of Capital Controls on Cash Withdrawal Credit-Positive for Greek Banks, Moody's Says

The full abolition of limitations in cash withdrawal is credit-positive for Greek banks, Moody's said in a report released on Thursday. The credit rating agency said that an improvement of economic outlook in Greece and an increase in private deposits in the last few months allowed the loosening of capital controls "which will probably enhance depositors' confidence and help banks to further improve their financing profile, which is credit-positive".  Moody's said that a gradual return of deposits in the banking system in the last seven months and greater optimism after the successful exit from an economic adjustment program were the main reasons behind the decision to significantly loosen capital controls. "Additionally, a bigger reduction of banks' dependence from the ELA mechanism showed the improvement of Greek banks in the last quarter," it said.

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