Banks have few deposits – Kommersant FM
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The deficit of deposits in banks could amount to 1 trillion rubles. by the end of the year, ACRA experts predict. According to analysts, because of this, credit institutions are ready to raise rates, including ahead of the Central Bank’s pace. There are resources for this – a record amount of cash in the hands of Russians has reached 18 trillion rubles.
The banks themselves made money on foreign exchange transactions, and now the market is waiting for a cooling, noted Yuri Belikov, Managing Director for Validation at Expert RA. The problem with the deficit of deposits, according to him, is systemic in nature: “The most important factor is the expected slowdown in retail lending in both the consumer and mortgage segments, since the debt burden of the population has grown significantly – there is less and less effective demand.
And coupled with the measures of the Bank of Russia to cool the market, the interest income base will also cease to scale as much as over the past 2.5-3 years, will cease to erode arrears, and this will also lead to a slowdown in the rate of profit generation. But, in fact, the indicated 2.6 trillion rubles. Banks will earn net profit for the year, and it’s not far from that.
As for the situation with the influx of client funds, with deposits, both the money of corporate clients and retail clients showed moderate growth rates, about 7-8%, but, unfortunately, there is no change in the term structure of these resources. Moreover, there are even trends towards an increase in the share of short-term funding. Everything is clear with the funds of individuals – these changes occurred back in 2021, when rates were low, citizens began to look towards the stock market.
Well, against the backdrop of the instability of last year and this year, the share of savings accounts and demand accounts is very high, more than 40%. And, accordingly, banks cannot use these resources to fund long-term active operations. As a result, we get a systemic problem of a shortage of long-term sustainable funding, which to some extent depreciates the positive growth rates that can be observed.”
Banks could cover this deficit by raising rates, and for now they have the opportunity to do this, noted Yegor Lopatin, director of the group of financial institution ratings of the NKR agency: “There is a shortage of long-term liabilities. Until 2022, there were quite a lot of them, funded by bonds, including Eurobonds. Now, taking into account the virtual closure of the Western market, this shortage is precisely what is observed.
Banks correct it by raising rates on deposits if necessary, and they still have this tool. Credit institutions have a fairly large reserve of net interest margin. If the usual 4.3% was in 2020 and 2021, then according to the results of the first half of 2023 – 4.6%.
Banks have room to raise rates, and if any of them have a deficit, they will likely just raise their rates and correct it.”
Analysts admit that deposit rates may exceed the key rate. Although the pace of lending is decreasing, this will allow banks to avoid drastic steps, says Pavel Samiev, general director of the BusinessDrom analytical center:
“An equally important factor is the demand for this source of funding, based on the dynamics of lending or other options for placing funds. First of all, this is lending, since such a source of funding as deposits is relatively more expensive than others, and it is precisely this that is needed in order to support the growth of retail lending.
The dynamics will be weaker than in the first half of the year, and the only question is how much the growth rate will fall. If we have a serious cooling in the market, there will be less demand for deposits, which means that rates will not rise as much. I think that with a high probability in the near future the deposit rate will not catch up with the key level.”
As Kommersant noted, despite the overall increase in profits of the banking sector in July, many large credit institutions worsened their results. Thus, the indicator of Alfa Bank fell by almost 17 times, and VTB – by 19.
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