Greek bank deposit outflows showed a significant decrease in March, reducing fears regarding the country’s banking system that has suffered a shock by the enormous fund outflow recorded during the past few months.
According to the European Central Bank’s (ECB) data, published today, the Greek deposits fell from 147.5 billion euros in February to 145 billion euros, reduced only by 2.5 billion euros. That fall, does not concern experts, as it is compared with outflows ten times higher recorded from December 2014 until February 2015. It should be noted that the country was then strangled by political instability caused partly by the January 25 snap elections, announced in early December, the government’s change and the new cabinet’s tense relation with the European partners, from the first days it took office. Although, the data also suggests that the major Greek savers who were able to transfer their money to banks abroad, have already done so.
“March was a less turbulent month. Those with a higher propensity to channel funds out of bank deposit accounts had already done so in the previous months. As the deposits balance drops we are getting closer to the core base,” said Athens-based Eurobank analyst Nick Koskoletos, as quoted by the Reuters.
The Greek government will have to reach a deal with its international lenders as soon as possible if it wants the remaining 7.2 billion euros bailout installment to be disbursed. In order for this to happen, though, its economic levels should first submit a revised reforms list, which will later be examined by the European partners.
Moreover, parallel to the enormous deposits outflow, the Greek banks have been stepping up their use of emergency funding provided by the country’s central bank, thus the cap on that Emergency Liquidity Assistance (ELA) has been progressively raised by the ECB.