It looks that the Lithuanian authorities want to introduce a limit in the operations in Lithuanian banks. They are thinking to restrict the quantity of cash the holders of bank accounts are able to get per month (maximum 500 euros). This kind of measure shows the weakness of the Lithuanian financial system and the lack of liquidity in the Lithuanian banks. My prognosis is that next wave of crisis in the Eurozone may provoke the collapse of the Lithuanian financial system if there is not a significative recovery of the economic activity in the short run. The scenario we saw some years ago in Cyprus is something that may happen in Lithuania soon.
Author: Mykolas Alutis