Given that BoG released its April balance sheet yesterday, it is a nice opportunity to take a fresh look at developments in its major components:

BoG Balance Sheet 2019

The things that stand out are the following:

  1. Regular monetary operations + ELA have been minimized to very low levels of less than €10bn. ELA more or less ended in 2018 since its figures are now basically zero.
  2. Securities purchased in the context of the ECB QE program are now stable around €63 bn.
  3. Total collateral posted recorded an impressive fall from €80bn a year ago to only €16.7bn now, a function mainly of the drop in ELA operations (from €10bn to zero).
  4. Target2 liabilities are down to only €24bn while extra banknotes are now recorded as a (small) net asset instead of a liability suggesting a significant return of cash outside of the banking system.
  5. Government balances have reached almost 2€9bn providing a large enough buffer for debt refinancing needs in the coming future.

The Greek situation has officially been stabilized with any creditor risk substantially minimized. Net Securities (Securities held for monetary purchases minus Target2 liabilities and extra banknotes) are now close to €40bn which means that BoG can easily cover any liabilities towards the Eurosystem even in the case of a Grexit while still maintaining a positive balance of European government securities.

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