Bank run doesn’t need to lead to euro exit

A spreading bank run could hasten Greece’s exit from the eurozone but it doesn’t have to end that way.

It is far less clear what the impact would be should the wave of withdrawals accelerate in other peripheral states such as Spain or Portugal, which are further from outright revolt over German-led austerity, and which, due to their sheer size, will enjoy a vastly improved negotiating position.

Greeks have been withdrawing hundreds of millions of euro of deposits, driven by a fear that a Greek exit from the euro will leave them holding less valuable new drachma.