Deposits are not returning to the Greek banking system. They dropped slightly for a fourth month in a row this September, central bank data showed Friday. 

An increase in deposits since June 2012, when a newly elected government eased fears that Athens might be leaving the euro zone, has run out of steam, Reuters reports.  

In September, businesses and household deposits fell 0.5 per cent to €161.35 billion ($222.72 billion) from €162.21 billion in August, according to the Bank of Greece. 

According to a detailed breakdown provided by Macropolis, outflows increased at €719 million in September from €212 million in August. The monthly flow reflects time and savings net deductions at €940 million and €268 million, respectively, which more than offset sight inflows of 501 million. The year to date flow is now marginally positive at 119 million on time inflows of 838 million, counterbalancing sight and savings outflows of 140 and 647 million, respectively. 

Although a part (€11.5 billion) of total deposit outflows of €89 billion until June 2012 have returned to Greek banks so far, a large part of the previously recorded outflows should be perceived as a permanent loss for the domestic banking system.

Greek banks lost around a third of their deposit base (€89 billion), after the country plunged into a debt crisis in late 2009, partly due to capital flight on fears of a euro zone exit.

At the same time, credit contraction remained unchanged, at 3.9 per cent year on year in September. Balances reached €221 billion. According to bank sources and troika projections, credit expansion is expected to resume as of next year in line with GDP growth, yet at low single-digit levels for the next couple of years.

*Hat tip to Yiannis Mouzakis who inspired the title of this piece