Uncertainty fuels cash outflow


A new wave of deposit outflows since the start of 2017 has seen some 2.8 billion euros leave bank accounts in the year to mid-February, fueling concern among lenders that the rising trend of the second half of 2016 getting will be reversed.

Deposits have shrunk from over 131.8 billion euros in end-December to 129.09 billion, and given the trend currently recorded, February will likely close near 128 billion euros, expanding the losses seen so far within 2017.

This is mainly attributed to two factors: The first is widespread uncertainty among depositors in Greece, as well as those who had deposits abroad and by bringing them home acquired the right to send them out again. The second factor is seasonal, based on the fact that the comparison is made with the year’s best month, which was December. Traditionally, the figure is “corrected” in January.

Government spokesman Dimitris Tzanakopoulos referred to the seasonal factor when he said yesterday that “there is no cause for concern.”

“Stability will be consolidated further with the upcoming completion of the bailout review,” he said, adding that the government aims for inclusion into the European Central Bank’s quantitative easing (QE) program next month.

The drop in the high level of deposits in December due to the Christmas bonus given to some private sector workers and a government handout to pensioners, as well as the higher liquidity of companies as they prettify their end-of-year results, is only half the truth for the outflow, which has reached up to 3 billion euros today.

The other half is genuine concern among depositors who have their money in the local credit system and appear in the last few days to be exhausting the permitted withdrawal limit of 840 euros per 14 days, according to bank sources. At the same time, there has been a reduction in so-called mattress money and cash held in safe deposit boxes to 43.2 billion euros in end-December, according to official figures.