Greek bank shares have fallen sharply for a third day, continuing the trend seen since the stock exchange re-opened at the start of the week.
The banking sector share index fell 20%, after falling by about 30% on both Monday and Tuesday. Individual shares are not allowed to drop by more than 30% in one day on the Athens market.
Overall, the Athens stock market was down 2.3%. The market re-opened on Monday following a five-week closure. Trading was halted after 26 June, just before capital controls were imposed in an effort to stop money leaving the country during the height of the Greek debt crisis. Greeks are still limited to withdrawing €420 a week in cash. “The market is looking for the bottom, we are not far away from it,” Alexander Moraitakis, head of Athens-based Nuntius Securities, told Reuters. “But bank shares are still pounded by selling pressure due to dilution fears, given their need to recapitalise.”
Greek banks have been hit by a flight of deposits as customers send their money abroad or hoard it as cash. The banks account for about a fifth of the Athens index.
Rules agreed by the government and the European Central Bank say local investors are not allowed to buy shares with money from their bank accounts, only with cash kept in safe deposit boxes or at home.
The main share index is down more than 50% from last year’s peak.