Total deposits held with Guernsey banks at the end of the first quarter fell by £699 million from the end of 1997 to £48,658 million, a modest drop of 1.4%.

Two trends emerged:

  • sterling deposits rose by £489 million
  • the sterling equivalent value of currencies other than sterling - mainly US Dollars, Deutschmarks and Swiss Francs - fell by £1,160 million.

It is estimated that the effect of sterling's strength against the major currencies at the quarter end accounted for some £566 million of the decline. However, since the period end, sterling has eased somewhat against these currencies and the position might well unwind next quarter.

The currency breakdown is now split 35% sterling and 65% other currency deposits. Local inter-bank activity rose by £450 million.

A table showing deposits since 1980 is attached.

At the start of the quarter the licences held by the Guernsey branches of TSB Bank (Channel Islands) Limited and Lloyds Bank PLC were surrendered and a new licence issued to Lloyds TSB Bank (Guernsey) Limited. Similarly, the licences held by Coutts Financial Services Limited and National Westminster Bank PLC were surrendered and a new licence issued to NatWest Offshore Limited. None of the above would have had any material effect upon the overall totals at the period end.

DEPOSIT WITH LICENSED DEPOSIT-TAKERS

End           No. of licensed    Deposits    Quarterly     Yearly 
Period        institutions         £Mn       Variation    Variation 
                                                 %            %

1980              43             1,800
1986              52             9,508
1987              54             8,838                     -7.0
1988              56            10,168                     15.0
1989              58            12,992                     27.8
1990 Mar          66            13,387         3.0
     June         68            13,469         0.6
     Sept         70            14,522         7.8
     Dec          72            15,476         6.6         19.1
1991 Mar          72            16,203         4.7
     June         72            16,829         3.9
     Sept         71            16,156        -4.0
     Dec          72            16,250         0.6          5.0
1992 Mar          73            17,849         9.8
     June         72            17,673        -1.0
     Sept         73            21,226        20.1
     Dec          76            27,442        29.3         68.9
1993 Mar          73            30,299        10.4
     June         74            32,605         7.6
     Sept         75            37,595        15.3
     Dec          75            37,482        -0.3         36.6
1994 Mar          74            37,773         0.8
     June         73            40,320         6.7
     Sept         73            41,439         2.8
     Dec          73            42,191         1.8         12.6
1995 Mar          72            43,018         2.0
     June         73            45,207         5.1
     Sept         73            44,437        -1.7
     Dec          73            46,855         5.4         11.1
1996 Mar          75            45,897        -2.0
     June         76            44,917        -2.1
     Sept         75            43,832        -2.4
     Dec          72            43,324        -1.2         -7.5
1997 Mar          73            45,652         5.4
     Jun          75            45,973         0.7
     Sept         79            47,786         3.9
     Dec          78            49,357         3.3         13.9
1998 Mar          76            48,658*       -1.4

*Of which £1,736 million constitutes local interbank deposits

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