In Brief
Loan growth in Cyprus hits 11 percent in July Cyprus’s banks increased their loans by an annualized 11 percent in July to 60.9 billion euros ($77.5 billion) as demand for mortgages increased, the country’s central bank said. Cypriot banks gave 16 percent more housing loans in July compared to the same month a year before, while consumer loans rose 2.8 percent. Total loans to companies rose 8.6 percent, the Central Bank of Cyprus said in a statement on its website. Total deposits rose 15 percent in July to 67.1 billion euros, as a 1.2-billion-euro drop in residents’ deposits was compensated by a 1.1-billion-euro and 271.3-million-euro increase in third-country and eurozone residents’ deposits respectively, the central bank said. (Bloomberg) Producer prices rise 6.1 pct on VAT hikes Greek producer prices rose 6.1 percent year-on-year in July, slowing from a 6.5 percent clip in June as energy costs fell, the Hellenic Statistics Authority (ELSTAT) said yesterday. Greek consumer price inflation rose to a 5.5 percent annual pace in July from 5.2 percent in June. «The producer price index inflation decline over the last few months is a welcome development, even though price pressures on the consumer will remain elevated during the remainder of the year. This is due to recent hikes in VAT and other indirect taxes as well as significant pass-through to the consumer, which indicates the persistence of oligopolistic structures in the economy,» said Platon Monokroussos, economist at EFG Eurobank. «On a more positive note, disinflation is likely to resume from July 2011 onward, due to sharply weakened demand pressures.» (Reuters) Advisers picked Piraeus Bank SA, Greece’s fourth-biggest lender, appointed Bank of America Merrill Lynch, Goldman Sachs International and UBS Investment Bank to advise it on its offer to buy the Greek government’s stakes in Hellenic Postbank SA and ATEbank, according to an e-mailed statement from the Athens-based lender yesterday. (Bloomberg) Monopoly extension OPAP SA isn’t currently in talks with the Greek government to extend its monopoly on sports betting beyond 2020, CEO Ioannis Spanoudakis said on a conference call yesterday. «We are not pressing the issue at this point in time but if it comes we are ready to discuss it,» Spanoudakis said. OPAP, Europe’s biggest publicly listed gambling company, is focused on «forming synergies» and is also open to international cooperation, Spanoudakis said. «In Internet strategy, I would not rule out looking beyond Greece,» he said. OPAP isn’t actively pursuing the idea, he said. (Bloomberg) Bond buying The European Central Bank needs to maintain its bond-buying program while the market remains fragile, said Sander Schol, a director of the Association for Financial Markets in Europe. ECB purchases have fallen to a level where they aren’t enough to bolster prices, Schol, whose division represents the region’s 20 largest primary dealers, said in an interview yesterday. Schol said the ECB has relied on its practice of regularly phoning banks to get price quotes, which keeps the market functioning by making institutions aware that the European Central Bank is ready to act if needed. «It’s important that the ECB continues to show its commitment to this buying program,» Schol said. «My members notice that markets are still very jittery.» The ECB has slowed purchases of government bonds to 338 million euros ($430 million) last week and 10 million euros the week before, compared with 16.5 billion euros in the first week of the operation, which started May 10. The ECB began buying bonds after the European Union and International Monetary Fund created a 750-billion-euro fund to backstop the single currency following a surge in borrowing costs in Greece, Portugal, Ireland and Spain. (Bloomberg)
