Consumer and company withdrawal of deposits from Cypriot banks accelerated in April, where big account holders in the two largest lenders were forced to take a hit as part of an international bailout.
Private-sector deposits fell by 7.3% to €41.322 billion after a nearly 4% fall in March, European Central Bank data showed today.
Banks on the island were shut for nearly two weeks in March after Cyprus agreed the €10 billion bailout, which forced major depositors to pay part of the cost of the rescue.
Capital controls are still in place on the island, with limits on how much people can transfer from their accounts. Cyprus is gradually easing the controls.
The data showed that deposits fell in other southern European countries mired in the debt crisis. Greece recorded a 1.6% decrease in private sector deposits, falling to €170 billion, and Spain saw similar development with a 1.5% fall. Deposits in Italian and Portuguese banks fell less than 1% each.
Monthly fluctuations in the figures are common, though sharp consecutive drops in countries with stable banking systems are unusual.
The data, which are for all currencies combined, are not seasonally adjusted and differ slightly from national central bank figures. They exclude deposits from central government and banks.
Spanish banks sell government bonds in April
Meanwhile, separate ECB data showed that Spanish banks reduced their exposure to government debt in April, while Italian banks kept stocking up on the paper.
The ECB data do not break down which countries' debt banks hold, but with a recent easing of market pressure on the governments struggling most with high debt, foreign and local investors are returning to euro zone bond markets.
Spanish banks cut €10.3 billion from their government bond holdings, offsetting a €15.9 billion increase in March.
Italian banks, on the contrary, kept adding to their sovereign debt holdings, recording a €7.4 billion increase after a €10.8 billion rise in March.
