(Athens, Greece) – According to Greece’s central bank, the amount of bank deposits made has increased by 278 billion euros for both households and businesses. Each month, the Bank of Greece releases a report showing various statistics, such as amount of deposits, monetary aggregates, MFI holdings of securities, and a Bank Lending Survey. The data is gathered on a monthly basis and released to the public. The aim is to spot trends that will help give an overview of the condition of the banks in Greece as well as the overall state of the economy. The fact that deposit rates had been down for the past few months was worth noting, but the decline was put on pause in May. The report was released on Monday. Deposits had declined to its lowest paint since July of 2003 back in April of 2016 at 121.43 billion euros.
Many believe that deposits started to pick up after Greece locked in its third bailout since 2010. The first wave of funds for this newest bailout was released last week. Funds have been trickling in since the country became eligible for this bailout. The country needs this bailout money to pay off loans that are coming due soon to the International Monetary Fund and the European Central Bank. As a result of the bailouts, there have also been a series of required austerity measures that needed to be implemented including tax hikes, pension cuts, and civil salary cuts. Austerity has been required by the international creditors in exchange for the bailout money.
Deposits are required in order for banks to function at their optimal level. In short, these deposits provide funds for other aspects of banking, such as to make funds available for development. When the banks have enough money to fund development, this causes a long term boost to the economy.