BANK deposits held in Zimbabwe's registered financial institutions continue to decline as liquidity problems bite, latest Reserve Bank of Zimbabwe (RBZ) figures show. The central bank's November 2013 monthly economic review released last week, also show that commercial and merchant banks lost their share of deposits to building societies in 2013. However, economist John Robertson argued building societies were getting huge deposits from insurance companies. "Insurance companies are looking at the much longer term and are into building projects hence the growth in deposits," Robertson said. Total deposits, other than demand deposits including People's Own Savings Bank , stood at US$1,959 billion in November 2013 down from US$2,018 billion in January 2013 . The RBZ report said total deposits grew to US$2,108 billion in May 2013 before sliding on news of the July 2013 general election to US$1 , 904 billion at the end of the election month and registering an all time low in the year after an announcement of President Robert Mugabe and his Zanu PF's victory over the two MDCs to US$1 , 877 billion at the end of August 2013 . The volume of deposits held by commercial banks declined to US$1 , 232 billion in November 2013 , down from the US$1 , 418 billion in January 2013 , while merchant banks also lost about US$33 million worth of deposits between January and November 2013 to US$79 , 7 million at the end of the period under review. As the other two classes of banks witnessed a decline in deposits over the 11 months, building societies registered a growth of more than 35% from US$422 , 8 million in January to US$573 , 1 million in November. Broad money recorded an annual decline of 0,46% in November 2013 , compared to a growth of 3,16% recorded in October 2013 . Robertson said this was the first time the country recorded a negative performance on year-on-year money supply. He said it was a worrying performance that could be worse on the December numbers. Broad money supply on a year-on-year basis grew by 21,9 % in January 2013 and by more than 10% between February and May 2013 before falling to 6,9 % in June, 4,3 % in July and 5,8% in August. On a month-on-month basis, broad money declined by 3,66%, equivalent to US$144 , 6 million to US$3 , 807 billion in November, from US$3 , 951 billion in October 2013 . "The decline was largely on the back of panic withdrawals experienced by the banking sector during the month under review. Also explaining the reduction in monetary stock, were subdued economic activity and persistent liquidity shortages which prevailed during the period of analysis," read part of the report. "The month on month decline was due to contractions of US$140 , 5 million in demand deposits and US$24 , 8 million in under 30-day deposits. Partially offsetting the declines were increases of US$15 , 2 million and US$5 , 5 million in savings and over 30-day deposits, respectively."
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