The Spanish banking system suffered record outflows of private deposits last month, but the authorities downplayed the significance of the development.
According to figures released Tuesday by the European Central Bank, 74.228 billion euros was withdrawn from bank accounts in July, the biggest monthly amount since September 1997. As a result, total deposits at the end of July stood at 1.508 trillion euros, a fall of 4.6 percent from the previous month.
Deposits have now fallen for four months of the year and stand at their lowest levels since May 2008, when the figure was 1.507 trillion euros. The amount withdrawn in July was more than double the previous highest figure for the year, which was in May when deposits fell by 33.157 billion euros.
Over the past 12 months, deposits have declined by 206.990 billion euros, or 12 percent, from 1.715 trillion at the end of July 2011.
Taxes and holidays
However, the secretary of state for the economy, Fernando Jiménez Latorre, said aggregate figures did not indicate there had been a “significant” fall in deposits with Spanish banks. Latorre suggested that funds may have been switched to other instruments, such as bank bills.
Spanish newswire Europa Press quoted Bank of Spain officials as saying that two-thirds of the withdrawals were by other financial institutions for motives related to securitization trusts.
Of the remaining third withdrawn by households and the corporate sector, the officials said that more than half can be accounted for by seasonal factors. Companies withdraw money from accounts to pay taxes on a quarterly basis, while withdrawals by individuals normally pick up in July and August to pay for vacations.
The sources said that taking these factors into account, the pattern of a slow decline in deposits seen since the middle of 2011 remains in place.