Oil exporters recycle more petrodollars in Q3-BIS

LONDON, Mar 5 (Reuters) Major oil exporters deposited a record billion with international banks in the third quarter of last year, maintaining the trend of recycling part of their oil revenues, the Bank for International Settlements said on Sunday.

The Basel-based BIS said the destination for deposits placed by OPEC member countries with BIS reporting banks was primarily the United States.

''Major oil-exporting countries continued to recycle a portion of their oil revenues through BIS reporting banks...

Deposits by residents of OPEC member countries... were primarily U.S. dollar-denominated,'' the BIS, a forum for central banks, said in a quarterly report released on Sunday.

Major oil exporting countries play an increasingly important role in the global financial market as their revenues have soared after last year's sharp rise in oil prices and they invest billions of petrodollars in global assets.

The BIS said the billion placed by OPEC members as well as non-OPEC oil exporters with BIS reporting banks was the largest quarterly placement by this group of countries recorded in its statistics.

The dollar share of reporting banks' liabilities to OPEC countries was relatively unchanged at 72 percent.

NON-OPEC PETRODOLLARS The BIS said residents of non-OPEC oil exporters including Norway, Mexico and Russia, placed billion in funds with BIS reporting banks.

The US dollar share of total liabilities with non-OPEC oil exporters fell to 61 percent in the third quarter, compared with 62 percent in the previous quarter and close to 80 percent prior to end-2002.

The BIS said over the last 15 years, roughly 16 percent of BIS reporting banks' total liabilities to OPEC members have been reported by banks in the United States.

The share of OPEC petrodollars being placed in Britain fell to 25 percent in the third quarter. This compares with 35 percent in 1985.

UK banks' share of total liabilities to non-OPEC oil exporters rose to 35 percent in the third quarter from 22 percent in 2002.

''Residents of non-OPEC oil-exporting countries have increasingly channelled their deposits through banks in the United Kingdom,'' the BIS said.

The BIS added the continued recycling of oil revenues, and deposit placements by banks in Asia-Pacific, led to a net outflow of funds from emerging markets.

REUTERS VJ RAI0213