Monday 19 March 2018

ECB emergency loans fall to lowest level since guarantee

Michael Noonan
Michael Noonan

Donal O’Donovan

Banks use of emergency loans from the ECB has dropped to the lowest level since the bank guarantee back in 2008.

New data from the Department of Finance shows that the so called “covered banks” including AIB, Bank of Ireland and Permanent TSB owed €31.1bn to the ECB at the end of October.

It is the lowest level of debt since September 2008.

The so called covered banks account for three quarters of the €40bn owed to the ECB by banks operating in Ireland.

Not all cash owed to the ECB is for emergency loans, but at the height of the banking crisis lenders here owed a total of €136.4bn to the ECB, a reflection their inability to source cash on the normal inter-bank markets.

The new figures show that the amount of cash on deposit at the Irish banks fell slightly in October.

The Department of Finance said that was because of short term deposits being withdrawn, but banks themselves will be anxious to see if the increase in savings taxes introduced in Budget 2014 is having an impact.

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