Greek pensioners start bank runs after payments delayed

Panic descends in Athens as elderly are denied state living stipend

Greek pensioners stage a protest outside the Social Insurance Foundation headquarters against a government's decision to order state entities to park idle cash at the central bank (REUTERS)

Panic descended in Athens on Thursday as Greece’s 2 million pensioners were hit with delays to their monthly state stipend. Pensioners raided their accounts and broke into a board meeting, according to reports.

The Greek government blamed delays to payment on a technical hitch but this was denied by a government insider, who told the FT that state pension funds were still missing several hundred million euros on Tuesday morning.

Greece's main state social security fund delayed pension payments due Tuesday by almost eight hours. The fund relies on a monthly subsidy from the government to meet its payments.

Tsipras will lead the talks over the bank holiday weekend himself (Reuters)

The Times reported that pensioners broke into a board meeting of the state pension fund demanding that it stop transferring cash reserves to the government. The fund must make these transfers under emergency decree, to keep the country solvent.

Many others queued outside the National Bank of Greece, which pays out state pensions staggered over several days.

“Normally I only withdraw half the money at the end of the month, but today I’m taking it all,” Sotiria Zlatini, 75, a former civil servant, told the FT. “There are so many rumours going round because of the government’s problems and what happened two days ago.”

Greece has been denied more bail-out money from the EU until both sides can agree on a set of reforms for the country.

Since August, Greece has had to rely on its own funding resources because it cannot agree terms for pension payments, structural reforms and changes to its tax regime.

Talks have resumed in Brussels following the departure of Yanis Varoufakis, the Greek finance minister, who was sidelined by premier Alexis Tsipras after failing to reach an agreement. Tsipras will lead the talks over the bank holiday weekend himself.

Ratings agencies have warned that the risk of a Greek default is rising. Jeroen Dijsselbloem, who is representing the EU on the other side of the talks, has said that EU is prepared for the worst.