The reliance of Irish banks on European Central Bank funding rose again in December, following the Frankfurt-based bank's allotment of an unlimited amount of three-year loans for the first time last month.
Domestic and overseas lenders with operations in Ireland had €76.3 billion of long-term ECB loans at the end of December, up from €71.1 billion a month earlier, new Central Bank figures show.
The main refinancing operations for Ireland fell to €30.5 billion from €31.8 billion. Total ECB funding increased to €107.2 billion from €102.9 billion a month earlier, it said.
Irish banks have been forced to turn to the ECB for funding since the crisis struck the Republic's financial system in late 2008.
In December, more than 500 banks across Europe borrowed €489 billion from the ECB in an exercise designed to ease the euro zone debt crisis.
"There's no doubt that the Irish banks have availed of this cheap long-term funding line," Colm Ryan, co-head of fixed income at Dublin-based Goodbody Stockbrokers, said before the report was released. "It gives them certainty over their funding structure and costs as they continue to deleverage."
Yesterday, ECB president Mario Draghi said last month's massive injection of cash into the financial system was beginning to lubricate seized credit markets.
Separately, figures published by the Central Statistics Office today showed that Irish households continued to save a large proportion of their incomes in the third quarter of 2011.
Gross saving by households stood at €3.9 billion during the three month period, or 17.3 per cent of their aggregate incomes. This is broadly in line with savings rates in recent years, but considerably higher than during the period up to 2008 when households consumed a much larger proportion of their incomes.
Additional reporting: Bloomberg
