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Dollar deposits blow for Argentine banks

Buenos Aires, June 17, 2012

Argentine banks lost more than five per cent of their dollar deposits in the week to June 8 as stringent government controls on buying foreign currency unnerved depositors and prompted them to withdraw savings, central bank data showed.

President Cristina Fernandez imposed restrictions on dollar purchases late last year after surging demand for greenbacks forced the central bank to spend several billion dollars in foreign reserves to prop up the peso.

Savers and companies started drawing money out of dollar-denominated bank accounts earlier this month when the AFIP tax agency charged with controlling foreign-currency purchases virtually banned retail sales at the official rate.

Some analysts say fears of further controls - such as restrictions on dollar deposits - are fuelling the slow but steady withdrawal of deposits in the US currency, long seen as a safe haven in crisis-scarred Argentina.-Reuters




Tags: Dollar | deposit | Argentina banks |

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