Bank deposits rebound in August

Bank deposits in Greece are showing signs of a rebound this month for the first time in the last couple of years, as customers are responding positively to last month?s news about a second bailout for Greece, reinforcing trust in the local system.

At the same time, uncertainty about the Cyprus economy has resulted in many Greeks withdrawing their deposits from its banks and bringing them back to Greece, taking the inflow of funds to about 1.5 billion euros in the last three weeks, Bank of Greece Governor Giorgos Provopoulos told Finance Minister Evangelos Venizelos during a meeting on Tuesday.

This means that August may well prove to be the first month with a positive balance of capital inflows, after total deposits in the local banking system had shrunk to 249.4 billion euros in June from 280.2 billion euros last December.

Some of the deposits are from the general government sector, amounting to 9.1 billion euros at the end of June, official data indicate.