Greek Bank Deposits Post First Annual Increase in Four Years

By Marcus Bensasson  Jan 29, 2014 6:38 PM GMT+0200

Bloomberg

Greek bank deposits rose 1.1 percent in 2013, the first annual increase since Greece triggered the euro area debt crisis in 2009.

Deposits rose to 163.3 billion euros ($222 billion) in December, from 161 billion euros in November and 161.5 billion euros a year earlier, the Bank of Greece said in a statement on its website today. Deposits are 31 percent below their peak of 237.8 billion euros in September 2009.

“There’s been a slight increase in confidence, and some people have returned their money,” said Tassos Anastasatos, an economist at Eurobank Ergasias SA (EUROB) in Athens. “However, I wouldn’t expect the kind of outflows since the beginning of the crisis to return unless the climate really improves, and that requires that we go on to a new deal for debt relief and the economy goes onto a path of sustainable growth.”

Greek Prime Minister Antonis Samaras this month urged euro-area leaders to be prepared to offer more debt relief to Greece, which has received two bailouts from the euro area and International Monetary Fund worth 240 billion euros. Greece and its creditors expect the economy to grow 0.6 percent this year after six years of recession and a record unemployment rate of 27.8 percent.

Greek bank lending to households and business declined at an annual 3.9 percent rate, compared with a 3.8 percent drop in November, the central bank said in a separate statement.

In Cyprus, deposits fell to 47 billion euros from 47.2 billion euros in November, the Central Bank of Cyprus said today in a statement on its website. From a year earlier, they dropped 23.2 billion euros, or 33 percent, as uninsured depositors at its two biggest bank took losses as part of the country’s own 10 billion-euro bailout in March.

To contact the reporter on this story: Marcus Bensasson in Athens at mbensasson@bloomberg.net

To contact the editor responsible for this story: Craig Stirling at cstirling1@bloomberg.net