It’s been a while since I last looked into Bank of Greece balance sheet figures and given that the Greek central bank has released its April 2018 numbers I decided to take another quick look into them:
A few things stand out:
- Other claims (which is code for ELA) is down more than €11bn to a total close to €10bn. It is clear that Greek banks are moving closer to eliminating their need for non-standard financing, something which could happen during 2018. Obviously this also means that ELA income for BoG (and by extension for the Greek Treasury) will also show a significant decline (BoG should earn a bit more than €10mn/month as ELA profits by now).
- The big drop in ELA was mainly driven by a reduction of almost €16bn in BoG liabilities towards the Eurosystem (Target2 and banknotes) which total €48.4bn.
- Since BoG participation in Eurosystem QE continued at a slower pace the ‘Securities held for monetary policy purposes’ registered a further increase to €62bn. This means that BoG has a surplus of €13.5bn in securities held as assets compared to its liabilities towards the Eurosystem which would make a possible Grexit a bit easier since settlement of BoG Euro liabilities would be made using its (Euro government) securities portfolio.
- The lower need for CB financing has led total collateral posted at BoG down to €80bn, a figure which is quite manageable and far lower than the peak of €200bn reached during the 2015 turmoil. Most of the collateral are used for ELA financing so a possible elimination of ELA in the near future will make life much easier for Greek banks.
- Government deposits at the BoG are now close to €15bn registering an increase of €4bn during 2018. It seems that the Greek government is continuing its process of accumulating a large cash buffer for its «clean exit» scenario.
Overall BoG balance sheet figures suggest stabilization in external liabilities, ELA financing and a much lower toll on Greek bank profits from ELA loans (BoG should be around €40mn/month lower in April compared to a year ago).
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