Eurozone households are increasingly placing deposits in banks outside their home countries, with cross-border deposits reaching 151 billion euros in August 2024, or approximately 1.6% of total household deposits, according to a European Central Bank blog post.
The figure represents a significant jump from 95 billion euros in early 2020, when cross-border deposits accounted for 1.2% of total household deposits, wrote ECB analyst Matthias Rampf.
“One of the advantages of the monetary union is access to financial services in euro area countries other than your own,” Rampf wrote in the blog post. “While the volume still is relatively low, it is growing at an impressive rate”.
France, Luxembourg, Germany, and Italy have received the largest volume of cross-border deposits from other eurozone countries. Italy has recorded the highest growth in absolute terms over the past five years, with deposits from other countries nearly doubling since 2022.
Luxembourg leads in cross-border deposit share at 37%, followed by Estonia at 20%, Lithuania at 16%, Malta at 10%, and Latvia at 6%. The analysis shows significant regional variations, with Cyprus, Greece, and Slovenia experiencing more outward than inward deposits. Cyprus reported 9.5% outward and 4.5% inward deposit flows, while Greece showed 4.7% outward versus 0.6% inward deposits.
The trend suggests progress towards banking union integration, with higher deposit rates and significant country differences likely contributing to the development, alongside digitisation and online banking offerings, the report noted.
