Skip to main content

House­hold depos­its fell by €20.6bn in Eurozone.

Eurozone
The fall in euro­zone bank depos­its, which star­ted a few months after the ECB began rais­ing rates last sum­mer, marks a reversal from the money that had been pour­ing into banks, par­tic­u­larly since the pan­demic star­ted. In Feb­ru­ary, the decline accel­er­ated as depos­it­ors cut their hold­ings at euro­zone banks by €71.4bn, the biggest reduc­tion since records began in 1997. House­hold depos­its fell by €20.6bn, the most significant fall since that data star­ted to be col­lec­ted in 2003. The with­draw­als in the five months since Octo­ber amoun­ted to 1.5 per cent of the almost €14tn euro­zone banks held for depos­it­ors and were less than the $500bn of depos­its that have been pulled out of US banks in the past year.

In the UK, there have been sim­ilar out­flows of depos­its by cor­por­ate cus­tom­ers, which with­drew £20.3bn from banks and build­ing soci­et­ies in Janu­ary, a record since this data began in 2009, accord­ing to Bank of Eng­land fig­ures. However, UK house­hold depos­its con­tin­ued to grow by £3.5bn. Banks in the euro­zone have been slow to pass on higher interest rates to depos­it­ors. The ECB raised its deposit rate to 3 per cent this month, but the highest instant access rate for savers at Ger­man banks is 1.6 per cent, accord­ing to deposit broker Raisin.

Overnight depos­its at euro­zone banks fell €140bn in Feb­ru­ary, tak­ing the decline over the past six months to €512bn. However, this was par­tially off­set by an increase in depos­its with an agreed matur­ity up to two years, which rose by €83bn in Feb­ru­ary and by €476.3bn in the past six months. Total lend­ing by banks to euro­zone cus­tom­ers fell for the third straight month in Feb­ru­ary, tak­ing the total three-month decline to €72bn and end­ing nearly five years of steady growth. Eco­nom­ists say this month’s bank tur­moil is likely to make lenders more cau­tious, squeez­ing credit sup­ply.

www.sba.tax

Labels:

Comments

Post a Comment

Cloud Bookkeeping

HS2 cost cuts new routes and add delays.

 Trans­port depart­ment offi­cials have begun work on «Project Sil­ver­light» sug­gest­ing the high­speed rail scheme might face four addi­tional years of delay. The planned High Speed 2 rail line faces fur­ther delays of up to four years and more cuts to the project under plans being drawn up by min­is­ters to rein in its bal­loon­ing costs. The extra delays to the coun­try’s biggest infra­struc­ture project would mean that it would not be com­pleted until as late as 2045 — 12 years after ori­gin­ally planned. «This is a func­tion of infla­tion; we are hav­ing to find huge sav­ings because the cost of everything the depart­ment is already doing will have become so much more expens­ive by then,» said one gov­ern­ment offi­cial. In Octo­ber, the FT repor­ted that the Treas­ury had asked HS2’s man­age­ment team to identify poten­tial cuts or «scope reduc­tions» to the high-speed line. Trans­port depart­ment offi­cials have sub­sequently begun work on Project Sil­ver­light aimed at fi...
4 comments
Read more

Doubt on CS's collateral.

  Credit Suisse provided an emergency $140mn loan to Greensill Capital based partly on invoices to companies that deny ever doing the business stated on the documents. The Swiss bank provided the loan in October 2020, less than five months before the collapse of Greensill, a supply chain finance firm that counted former British prime minister David Cameron as a senior adviser. Invoices issued by metals magnate Sanjeev Gupta’s Liberty Commodities and sold to Greensill formed part of the collateral for the loan, according to documents seen by the Financial Times and people familiar with the transaction. Yet several of the parties named on the invoices have told the FT they did no business with Liberty. GFG has consistently denied any wrongdoing. Credit Suisse’s loan had a clause dictating that the collateral value had to be equal to or greater than the $140mn borrowed. The terms of the debt agreement only allowed invoices on Green-sill’s balance sheet to count towards this tally if t...
2 comments
Read more

Tax cut

  Sterling tumbled against the dollar to below $1 . 09 ,  hitting its lowest point since 1985 ,  after UK chancellor Kwasi Kwarteng unveiled a £45bn debt-financed tax-cutting package that sparked a historic increase in borrowing costs .  Kwarteng’s political and economic gamble includes the biggest set of tax cuts for 50 years ,  with the end of the 45p additional rate for the highest earners as well as a sharp reduction in levies on dividends .  But concern over the amount of debt required to finance the tax cuts triggered a frenetic day of trading that raised doubts on whether Britain’s new economic approach was sustainable .  «Britain will be remembered for having pursued the worst macroeconomic policies of any major country in a long time» . Kwarteng has staked the political fortunes of the Conservative party on the bet that the radical tax cuts and deregulation will raise Britain’s sluggish growth rate to 2 . 5 per cent .  «This is a new appr...
Post a Comment
Read more