1/2/15: Oh, those largely repaired Irish banks...

What do foreign 'experts' like BofE Mark Carney forget to tell you when they say that Ireland's banking system has been [largely] repaired?

Oh a lot. But here are just two most important things:

Both, in level terms and in growth terms, Irish banks remain zombified. 'Repaired' into continuously shrinking credit supply and stagnant household deposits base, the banks have been flatlining ever since the beginning of the crisis. In the last 6 consecutive quarters, household deposits posted negative rates of growth - a run of 'improvement' that is twice longer than the 'recovery period' of Q3 2012 - Q1 2013 when the deposits rose (albeit barely perceptibly).  Meanwhile, credit continues to shrink in the system with not a single quarter of positive growth (y/y) since Q4 2009. In four quarters through Q3 2014, credit for house purchases shrunk at just around 3.05% on average - the steepest rate of decline since the start of the crisis.

"Yep, [largely] repaired, Mr. Carney", said undertaker firming up the dirt on top of the grave...

4/1/2013: Irish Private Sector Deposits: November 2013

Central Bank of Ireland published series of data today covering deposits and credit in Irish banking system through November 2013. Here are the highlights on deposits. Credit side was covered in the previous post here: http://trueeconomics.blogspot.ie/2014/01/312013-irish-private-sector-credit.html

Here, we cover deposits and loan/deposit ratios:

• Private sector total deposits fell in November 2013 to EUR180.2 billion from EUR180.417 billion in October, but deposits are up EUR13.696 billion (+8.23%) y/y. 3mo average through November 2013 is up EUR13.259 billion on a year ago.
• However, private sector non-financial deposits (deposits by households and non-financial corporations) show much weaker performance than total deposits, rising only EUR1.357 billion (+1.11%) y/y in November and up just EUR969 million (+0.79%) year on year on 3mo average basis.
• The main reason total deposits are up is down to Insurance corporations, pension funds and other financial intermediaries booking a rise of EUR12.339 billion in deposits in November 2013 compared to November 2012.
• Households' deposits are down EUR1.013 billion (-1.1%) y/y in November and down EUR567 million compared to October 2013. 3mo average through November 2013 is down EUR975 million (-1.06%) y/y.
• Non-financial Corporations' deposits are up EUR2.37 billion y/y in November (up EUR1.944 billion on 3mo average basis) and are up EUR99 million on a monthly basis.

With private non-financial sector (households and NFCs) loans at EUR188.892 billion (down 0.59% y/y and down 0.79% m/m) and private non-financial sector deposits at EUR123.731 billion (up 1.11% y/y and down 0.38% m/m):

• Loans to deposits ratio in November 2013 stood at 153%, basically unchanged since August 2013 and marking the lowest level since October 2003.

Note: The data for both deposits and loans is  severely distorted by changing composition of banking institutions (exits by a number of banks from the market) and by regulatory changes (inclusion of new institutions, e.g. credit unions).