ATHENS Dec 29 Greek bank deposits rose slightly
in November for the second month in a row but remain at levels
last seen 13 years ago, keeping banks hooked on central bank
funding, data released by the country's central bank showed on
Business and household deposits rose by 170 million euros,
or 0.14 percent month-on-month to 124.80 billion euros ($130.65
billion), their lowest since November 2003. They had increased
by 1.16 billion euros to 124.63 billion in October.
Greek banks have seen only a trickle of deposit inflows in
more than a year after the country clinched a third bailout to
stay in the euro zone. They remain dependent on central bank
borrowing to plug their funding gap.
The gap between outstanding loans and deposits has forced
Greek lenders to rely on borrowing from the European Central
Bank and the Bank of Greece to plug their funding holes.
Greece's banking sector saw a 42 billion euro deposit
outflow from December to July last year. Capital controls
imposed on June 28 last year helped contain the flight but
sharply increased banks' dependence on emergency liquidity
assistance (ELA) from the Bank of Greece.
The government eased capital restrictions this year after
making headway on bailout-mandated reforms and improved
confidence in the banking system.
As part of the relaxation of controls, "mattress" cash that
are returned to banks are not subject to the restrictions,
meaning amounts deposited can be fully withdrawn.
Banks have been offering higher interest rates to attract
back billions of euros that savers pulled out in cash last year,
paying up to half a percentage point above what existing time
($1 = 0.9552 euros)
(Reporting by George Georgiopoulos)