Greek crisis and banking systemProject created by:

Ardalis Dimitrios

Gazouni Maria

Koios Christos

Koulmanda Eirini

Vlachou Antonia

The Greek debt crisis• Part of an ongoing Euro zone crisis• Caused by the Global Economic Recession (Great

Recession) in October 2008

Causes of the Greek debt crisis• GDP growth rates lower than anticipated• Government deficit with huge fiscal imbalances • Government debt level • Budget compliance • Statistical incredibility

TAX EVASION Tax evasion has always been a problem for the Greek Government.

“BLACK MARKET”

Greece: 24.3% of GDP

Estonia :28.6%

Latvia : 26.5%

Italy: 21.6%

Belgium: 17.1%

Germany:13.5%

Transactions between Greek government and Goldman Sachs

In order to keep within the Monetary Union guidelines, Greece misreported the country’s economic condition.

In 2010, the transactions between Greece and the Goldman Sachs bank were revealed proving that Greece was hiding the debt.

SECOND ECONOMIC ADJUSTMENT PROGRAMME DEBT-TO-GDP RATIO FROM 198% TO 157%

Greece had to face a double problem:

1. Increasing debt level “interest rate death”

2. Fundamental problem structural imbalance in the national account

Hellenic Financial Stability Fund € 48.2 bn recapitalization

The first €24.4bn were injected in the 4 biggest Greek Banks (NBG, Alpha and Piraeus)

THE GHOST OF THE NEW DRACHMA

• Would the introduction of a national currency help pull the Greek economy out of recession?

• The banking system is highly affected by all exit strategies

Emphasis on the banking system It should be stabilized the sooner possible and it may offer a real solution to the problem