Deposits in the already weak banking systems of Spain and Greece seem to me the most likely to be at risk. While there's no reason to expect a sudden rush for the exits in those countries, it may not be unreasonable for people to believe that a €100.000 deposit in Deutsche Bank or ING might be a bit safer than the same deposit in Caja Madrid or Pireaus Bank. So why not shift some of that money, just to be on the safe side, before the next crisis hits the eurozone?
A gradual shift of deposits out of Spain and Greece could spell trouble for those banks, even if the shift is well short of what could be called a bank run. As the chart above illustrates, Spain and Greece s saw their banks' deposits steadily leaving town during 2011 and the first half of 2012. However, bank deposits in both countries stabilized in recent months, ever since the ECB's unequivocal statement in July 2012. If people interpret this week's events as undermining that crucial statement by the ECB last July -- an interpretation that I certainly wouldn't argue with -- then we may expect to see the negative trend in peripheral bank deposits resume. And with it the periphery's banking problems may resume as well.
Quelle: The Street Light
