ECONOMY

Private-sector deposits in Cypriot banks slump in April

Consumer and company withdrawal of deposits from Cypriot banks accelerated in April, where big account holders in the two largest lenders were forced to take a hit as part of an international bailout.

Private-sector deposits fell by 7.3 percent to 41.322 billion euros after a nearly 4 percent fall in March, European Central Bank data showed on Wednesday.

Banks on the island were shut for nearly two weeks in March after Cyprus agreed the 10-billion-euro bailout, which forced major depositors to pay part of the cost of the rescue.

Capital controls are still in place on the island, with limits on how much people can transfer from their accounts. Cyprus is gradually easing the controls.

The data showed that deposits fell in other southern European countries mired in the debt crisis.

Greece recorded a 1.6 percent decrease in private sector deposits, falling to 170.0 billion euros, and Spain saw similar development with a 1.5 percent fall. Deposits in Italian and Portuguese banks fell less than 1 percent each.

Monthly fluctuations in the figures are common, though sharp consecutive drops in countries with stable banking systems are unusual.

The data, which are for all currencies combined, are not seasonally adjusted and differ slightly from national central bank figures. They exclude deposits from central government and banks.

[Reuters]