Greece Is Risk for Euro Area as Contagion Possible, Knot Says
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The situation in Greece is of concern and a Greek default may have a contagion effect, European Central Bank Governing Council member Klaas Knot said.
“The already shaky liquidity position of Greek banks will worsen if deposits continue to flow out,” Knot said in the Dutch central bank’s semi-annual Financial Stability Report published on Tuesday. “An unhoped-for bankruptcy of the government would heavily derail the Greek economy” and “the impact of such an event on other countries in the euro-area is still uncertain.”