FRANKFURT Oct 6 The impact of the European
Central Bank's charge on euro zone banks' deposits, a source of
grievance in Germany, is "negligible", Scope Ratings said on
Thursday, putting it at just 0.02 percent of their assets.
Analysts at the agency, which focuses mainly on issuing
ratings for banks, calculate the ECB's negative deposit rate -
effectively a 0.40 percent charge on banks' excess reserves -
would cost euro zone banks 5.6 billion euros ($6.3 billion) a
"While not immaterial, such a cost would be bearable,"
analysts Marco Troiano and Chiara Romano wrote in a report.
"It equates to about 0.02 percent of euro area banks' total
assets (30.6 trillion euros as of June 2016), so its impact on
return on assets (and equity) is negligible at the aggregate
This estimate is based on the assumption that excess
liquidity - the difference between banks' deposits and their
mandatory reserves - grows to 1.4 trillion euros in March 2017.
This is the earliest possible end-date that the ECB has
indicated for its bond-buying programme, which pumps 80 billion
euros into the financial system every month, the vast majority
of which ends up in banks' own accounts.
For related graphics on excess liquidity in the euro zone,
click on reut.rs/1PS1qZj and reut.rs/1PS7D7A and
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($1 = 0.8953 euros)
(Reporting by Francesco Canepa; Editing by Hugh Lawson)