THE value of Guernsey bank deposits fell by a quarter in 2009, but GuernseyFinance say the situation has stabilised.

Figures from the Guernsey Financial Services Commission show that the value of Guernsey bank deposits fell by 2.3% during the final quarter of last year.

This took the total value of deposits to £177.4bn at the end of December 2009 – a 25.2% decrease from 12 months previously.

But the head of the promotional agency for the finance industry, Peter Niven (pictured), said the island’s banking sector was in a more positive position than the continuing decline in deposit levels suggested.

‘What we can see is that a year ago the global financial downturn and an associated flight to quality were pushing deposit figures to a peak,’ he said.

‘Since then there has been a decline in the deposit base as a result of returning confidence within the investor markets coupled with very low interest rates. For example, we have seen a consistent fall of Swiss fiduciary deposits in particular.’

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