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:

BoG 2018Q1 balance sheet

A few things stand out:

  1. 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).
  2. 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.
  3. 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.
  4. 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.
  5. 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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