merrion street

Banks operating in Ireland (i.e. both covered and non-covered banks) continue to reduce their level of borrowing from the ECB. During April total utilisation of ECB facilities by banks in Ireland declined by €0.3 billion (c.0.6%) to c.€52.8 billion – it’s lowest level since September 2008.

Year-on-year, funding drawn from the ECB has reduced by €34 billion or 39%. The reduction from peak of €136.4 billion (end November 2010) is €83.7 billion or 61.3%.

Covered Banks usage of Eurosystem funding

Drawings from the ECB by Covered Banks declined by €0.1 billion (or 0.3%) during the month of April. ECB borrowings were flat during the month of April which reflects a reduction in the net funding requirement within the Covered Banks during the month.

Year-on-year borrowing from the ECB is down c.€26.7 billion (-40%) to stand at c.€39.45 billion at end-April. The steady decline in reliance on ECB funding reflects the continued strengthening of the banking system. The reduction in borrowing from the ECB has been achieved through managed deleveraging, deposit gathering and the return of AIB, BOI and PTSB to international funding markets.

Share of total ECB funding by banks at 6.1% (4.5% for covered banks)

The share of total ECB funding by banks in Ireland has declined steadily from a peak in November 2010 of c.26.5% immediately after the bailout to 6.1% at end-April 2013. The covered banks account for c.4.5% of total Eurosystem funding at end-April 2013, down from a peak of c.18.8%.