Greek PM announces bank holiday, capital controls

Prime Minister Alexis Tsipras on Sunday announced a bank holiday and capital controls in Greece after Greeks responded to his surprise call for a referendum on bailout terms by pulling money out of banks.

Tsipras blamed European partners and the European Central Bank for forcing Greece’s hand but said that would not halt the plan to hold a referendum next Sunday.

“(Rejection) of the Greek government’s request for a short extension of the program was an unprecedented act by European standards, questioning the right of a sovereign people to decide,» Tsipras said in televised address to the nation.

“This decision led the ECB today to limit the liquidity available to Greek banks and forced the Greek central bank to suggest a bank holiday and restrictions on bank withdrawals.”

He did not give details on how long banks would be shut or the restriction on the movement of capital. [Reuters]