Central Bank of Ieland: Deposit Flight Continued in March & May 2011

[Lightning]

The deposit flight has continued in March 2011 with another 2.3 billion EUR taken out of the guaranteed Irish banks.

http://namawinelake.wordpress.com/2...-figures-show-no-slow-down-in-deposit-flight/

Figures released by the Central Bank of Ireland (CBI) this morning for the month of March 2011 show that the flight of deposits from Irish banks shows no sign of slowing down. From an Irish perspective, possibly the most significant figure to watch is the total of private sector deposits in the six State-guaranteed financial institutions (AIB, Anglo, Bank of Ireland, EBS, Irish Life and Permanent and INBS). The total which represents businesses and households fell to €106.3bn in March 2011 from €108.6bn in February 2011 and is now down €23bn from a year ago, €11bn since the IMF/EU bailout in November 2010 and €2.3bn down over the course of just one month. The CBI and ECB continue to provide substitute funding for Irish banks which replaces this flight of deposits and Irish banks continue to provide extensive State-backed guarantees on deposits. It remains to be seen if the pace of decline in deposits slowed after the bank restructuring announcements made after close of business on 31st March, 2011 – Minister Noonan indicated the early signs were encouraging but since then our sovereign bond yields have sky-rocketed again.

 

[bryanod]

Nobody going to mention BOI's marginally higher deposit level over year-end then?

Course not splashed over papers and the media so people probably barely noticed, its not scaremongering so it doesn't sell.

 

[Sunny]

Nobody going to mention BOI's marginally higher deposit level over year-end then?

Course not splashed over papers and the media so people probably barely noticed, its not scaremongering so it doesn't sell.

All banks manipulate balance sheets at reporting dates with regard to deposits and liquidity. Even during the good days. It's pointless looking at published accounts for a true picture. The slightly better liquidity is also explained by the NTMA depositing EU/IMF funds at the two Irish Banks. Doesn't mean foreign investors are putting money back in.

 

[Lightning]

Nobody going to mention BOI's marginally higher deposit level over year-end then?

As Sunny said, the deposit 'growth' is just manipulation by the NTMA that placed a huge deposit with each of the Irish banks.

Look behind the figures, domestic deposits from retail deposit holders are further down.

 

[Brendan Burgess]

There was a good article in the Sunday Times saying that the outflow is primarily due to "savers and companies outside the eurozone"

€70 billion was withdrawn from Irish banks in 2010 , of which €47 billion was due to companies and savers outside the eurozone.

For the Bank of Ireland Group, Retail Ireland deposits actually increased from €34.8 bn to €35.1 bn, while Capital Markets dropped from €29 billion to €9.5 billion.

I must say I was surprised by that. While I know that Askaboutmoney users are not a representative sample, one would think that most personal savers had taken their money out by now.

 

[Lightning]

The deposit flight continued in May 2011 after the blip in April 2011.

http://namawinelake.wordpress.com/2...anks-resumes-in-may-2011-after-blip-in-april/

Figures released by the Central Bank of Ireland (CBI) this morning for the month of May 2011 show that the flight of private sector deposits from domestic Irish banks, which had reversed in April 2011 for the first time since October 2010, has resumed. The flight has resumed at a modest pace. Deposits in the six state-guaranteed financial institutions (AIB, Anglo, Bank of Ireland, EBS, Irish Life and Permanent and INBS) were down just €753m from €108,235m to €107,482m; though such deposits are still up €1bn from the low of €106,309m in March 2011. The banking authorities might take some small comfort from the fact that the pace of private sector withdrawals from the covered banks has slowed considerably from the €3-4bn monthly declines that we were seeing earlier this year and late last year.

However the picture generally is still pretty dismal. All deposits (including Private Sector, Govt, Monetary Financial Institutions, and non-Irish resident) at the covered banks are down €26bn in the month to €285bn, the largest monthly drop since last November 2010 and are now down €130bn on a year ago.

 

[onq]

There was a good article in the Sunday Times saying that the outflow is primarily due to "savers and companies outside the eurozone"

€70 billion was withdrawn from Irish banks in 2010 , of which €47 billion was due to companies and savers outside the eurozone.

For the Bank of Ireland Group, Retail Ireland deposits actually increased from €34.8 bn to €35.1 bn, while Capital Markets dropped from €29 billion to €9.5 billion.

I must say I was surprised by that. While I know that Askaboutmoney users are not a representative sample, one would think that most personal savers had taken their money out by now.

Perhaps they have a sense of obligation.

ONQ.