Greeks defy Europe with overwhelming referendum 'No'

Euro coins are seen in front of a displayed of Head of Apollo on a 1.000 Drachma old Greece banknote in this file photo illustration taken in Zenica, Bosnia and Herzegovina, June 30, 2015. France and Germany called for an emergency summit of euro zone leaders to discuss Greeks' stunning referendum vote on Sunday to reject bailout terms, as calls mounted in Berlin to cut Greece loose from Europe's common currency. [Photo/Agencies]

EURO EXIT ON THE CARDS

With Greece facing its worst financial crisis in recent memory, Tsipras said Athens was returning to the negotiating table with the express goal of reopening banks which have been shut for over a week with the imposition of capital controls.

The ECB, which holds a conference call on Monday morning, is likely to maintain emergency funding for Greek banks at their current restricted level and avoid the drastic measure of yanking support, people familiar with the matter said.

Even then, the banks are expected to struggle as Greeks besiege cash machines to withdraw a maximum of 60 euros ($66) daily, though government officials have vociferously denied any plans to issue a parallel currency. Fears have grown of a shortage of petrol and medicine if the cash squeeze continues.

"After the 'big no' it is now a race between two forces: political pressure for a deal, versus the impact of banking dysfunction within Greece," J.P. Morgan said in a research note. "Although the situation is fluid, at this point a Greek exit from the euro appears more likely than not."

The referendum call by Tsipras eight days ago came after months of fruitless negotiations with European and International Monetary Fund creditors since the radical leftist government took power in January. That follows seven years of deep economic crisis that has stoked violent protests and driven youth jobless rates to nearly 50 percent.

Unable to borrow money on capital markets, Greece has one of the world's highest levels of public debt. The IMF warned last week that it would need massive debt relief and 50 billion euros ($55 billion) in fresh funds.

Opinion polls over the months have shown a large majority of Greeks want to remain in the euro. But many appear to have shrugged off the warnings of disaster, trusting that a deal can still be reached without the tax hikes and pension reform demanded by lenders and rejected by Tsipras.

"I have been jobless for nearly four years and was telling myself to be patient," said 43-year-old Eleni Deligainni, who said she voted 'No'. "But we've had enough deprivation and unemployment."

($1 = 0.9070 euros)