Long-term investor – Newspaper Kommersant No. 225 (7426) dated 12/05/2022

Demand for long-term deposits could rise by more than a quarter in December. Experts explain this by the desire of investors to fix profitability for a long time. At the same time, the inflow of customers into such instruments will allow banks to attract long-term liquidity, which is especially interesting for them in the face of the risk of tightening monetary policy.

According to a study by Banki.ru, which Kommersant got acquainted with, consumer interest in deposits for a period of one year will grow by 25-30% in December. Deposits from two years will be more popular by 10% at the end of this year, the study specifies. Banks confirm this trend. According to Gennady Chausov, Head of the Liabilities and Commission Products Service of Post-Bank, by the end of this year, the popularity of long-term deposits will only gain momentum and in the first quarter of 2023 their share may approach 70-80%. Annual deposits will be the most popular, since this is the most acceptable financial planning horizon for most depositors, says Andrey Spivakov, Chief Executive Officer of HCF-Bank. Alfa-Bank, MKB and Bank St. Petersburg also expect growth in demand for deposits in December.

According to the latest data from the Central Bank, in September, deposits with a term of three months to one and a half years amounted to about 45% of the total number of deposits, from six months to a year – about 32%. On deposits for a period of one to three years accounted for only 9%. In November, as in the previous two months, investors focused on deposits up to a year, follows from a study by Banki.ru. The maximum level of demand was demonstrated by deposits for a period of three months – they were chosen by 30% of clients, while the popularity of deposits with a maturity of six months was 25%. A slight increase was shown by the share of deposits for one month and a year in November.

The term of the deposit is a key decision-making parameter when placing funds for only 5% of respondents, according to Russian Standard, and 81% of clients are guided by the rate.

Banks are counting on this approach of customers. Today, there is a trend to increase rates primarily on long-term deposits, and customers who are looking for high rates will choose just such instruments, says Alexander Sychkov, director of the private banking department at Novikombank. Head of Savings Department at VTB Natalya Tuchkova adds that long-term deposits, in addition to increased profitability, make it possible to fix a favorable rate on deposits for a long time. At the moment, rates on long-term deposits range from 7% to 10% per annum, follows from a survey of “Kommersant” top 50 banks.

However, Natalya Menshova, head of the department for the development of deposit and settlement products at Renaissance Credit Bank, warns that such offers, as a rule, are about an attractive rate without early termination of the contract with payment of interest at the end of the term. “In order to expand the interest margin, banks seek to attract the maximum share of client funds to savings and settlement accounts, where the cost of resources is significantly lower than for time deposits,” points out independent expert Andrei Barkhota.

However, under the conditions expectations of a rate hike by the Central Bank banks have additional incentives to attract funds from citizens for long periods, possibly at interest rates, which are now relatively high. Bogdan Zvarich, chief analyst at Banki.ru, says that the attraction of funds by banks for deposits with a duration of one year allows credit institutions to obtain relatively long-term liquidity. If the situation with inflation worsens, the Central Bank may have to tighten its monetary policy, and in this case, long money is more interesting for banks than short money, shifted from deposit to deposit at current higher rates, the expert emphasizes.

Julia Poslavskaya