Depositors shift €5.1bn out of banks in one month
Savers and corporations move cash despite state guarantee
Nervous depositors took €5.1bn out of Irish banks in November, according to new figures from the Central Bank.
Irish consumers shifted €2.5bn of deposits out of Irish-regulated banks in November, bringing the total amount held in those institutions from €96.2bn in October to €93.7bn.
Big corporations, like pension funds, were also still moving large sums of money out of these banks. The Central Bank figures reveal they withdrew €2.6bn in November, bringing the total money they hold in Irish-regulated banks down from €45bn to €42.4bn.
The main Irish banks have reported an enormous loss of deposits this year.
Bank of Ireland said it had lost €10bn in a six-week period over August and September, while AIB said it lost €12bn of deposits over the four-and-a-half months to mid-November.
The figures do not reveal where the money, which has largely flowed from banks under the state guarantee, went.
However, it is believed to have moved to internationally-owned banks operating in Ireland, such as Rabobank, Ulster Bank and Danske-owned NIB.
Money held on deposit overnight remained volatile, with these type of consumer deposits falling by €504m last month, which may be related to seasonal factors, according to the Central Bank.
Deposits held for a set term of up to two years were also affected, falling by €2bn, while money being deposited for periods of longer than two years rose by €110m.
Consumers that are resident outside of the EU continued to take their deposits out of the Irish banks, withdrawing €2.3bn in total in the three months to the end of November.
The figures also show that the Irish banks are still heavily reliant on borrowing cheap money from the European Central Bank. The Central Bank reports an €11.7bn rise in bank borrowings from the ECB in November, bringing their total borrowings to €97.3bn.
And while the banks are losing deposits, the figures show a continued drop in money being lent to consumers and businesses in the Irish economy in November. Loans to households fell by 4.8pc, compared with the same month last year.
Mortgage lending remained depressed with total lending down 1.7pc, consumer loans have fallen by almost 16pc, while other loans are down by more than 20pc. The amount of money being borrowed to purchase new homes contracted by €212m, while consumer loans declined by €271m.
The figures also record the increase in debt funding received by the Irish banks that are covered by the bank guarantee from the National Asset Management Agency, which has taken bad loans off their balance sheets.
Earlier this month, the Central Bank reported that lending to small and medium-sized businesses had also continued to decline in recent months and at a faster rate than the drop-off in personal lending.
The Central Bank said that lending to small businesses operating outside of the financial and property sectors fell by 4.5pc during the six months to the end of September.