Deposits in the banking system dropped in April by €100m to €48.6bn compared to the month before, the Central Bank of Cyprus said in a statement on its website on Tuesday.

The increase in deposits last month was also on €74.8m monthly increase in deposits held by non-financial corporations to €11.1bn and by €6.6m held by households to €28.5bn, the central bank said. The increase in deposits in these categories more than offset a reduction by €141m in the case of other financial intermediaries and €79.4m in that of insurance corporations and pension funds.

Last month’s reduction in total outstanding lending was mainly on a €62.4m net repayments by households reducing their total debt to €20.7bn followed by other financial intermediaries with a €45m net repayment reducing its debt to €7.8bn, the central bank said. The general government repaid €2.6m in loans to banks reducing its balance to €748.1m. Loans extended to non-financial corporations rose by €9.9m to €19.4bn while the debt of pension funds rose by €0.2m to €7.7m.

In April, the government issued €2.4bn in government bonds in favour of the state-owned Cooperative Central Bank and simultaneously deposited €2.5bn to the lender to soothe depositor concern over the bank’s capital adequacy. The lender is currently negotiating with two investor groups who filed binding offers to acquire its operations.

Source: Cyprus Mail