The deposits were recognized as suitable – Newspaper Kommersant No. 196 (7397) dated 10/21/2022

Banks record an increase in the share of long-term deposits. This is happening against the backdrop of a purposeful change in the cost of deposits: if in March the highest yields on deposits of citizens were for periods of 3-6 months, now the rates on deposits from a year exceed the rates of short deposits. Since the announced mobilization provoked the withdrawal of money from the banking system, in order to compensate for the outflow of depositors’ funds, banks will probably have to raise rates even more.

The largest banks in the deposit market record an increase in the share of long-term deposits. This trend was noted in VTB, Alfa-Bank, FC Otkritie, Promsvyazbank (PSB). According to VTB statistics, now every fourth deposit is placed for a year or more. In particular, in the third quarter of 2022, more than a quarter of VTB deposits were opened for a year or more, their share increased by 20% compared to the second quarter. In the second quarter, deposits with a term of one year or more accounted for an average of only 9% of opened deposits. At Alfa-Bank, the share of deposits for a year or more increased by about eight times compared to the first quarter of 2022. In PSB, following the results of the third quarter, the share of deposits opened for 1–2 years increased by more than a third. In FC Otkritie, now more than half of the deposits are issued for one year, says the leader of the Savings and Investments division, Alexander Borodkin.

Demand for short deposits was driven by higher returns in the first and second quarters of 2022.

According to Mr. Borodkin, even in the second quarter, maximum rates were offered for three to six months. But starting from June, banks began to offer more favorable rates on long-term deposits (1-3 years). In this regard, Alfa-Bank added, customers began to fix a favorable rate for a long time, especially in the face of an active reduction in the key rate. The only bank in the top 10 that denies an increase in the share of long-term deposits is Sovcombank. However, from September 30, rates on long-term deposits at Sovcombank were raised to 7.5% per annum, equaling them with the rates of three-month deposits, the bank indicates.

Meanwhile, the last month of the third quarter turned out to be difficult for banks. In September, customers withdrew funds from the banking system, and over the month, retail customer account balances, according to data from the Central Bank published yesterday, fell by almost 500 billion rubles. This is the first outflow since March and the largest since February, when the population’s funds in banks decreased by 1.2 trillion rubles. The outflow is explained by an increase in the number of people who left the country who took cash with them, the Central Bank notes. “In addition, citizens tend to withdraw cash in a situation of stress or uncertainty, as was the case, for example, at the beginning of the year, but then they usually return the money to banks,” the regulator adds.

After the announcement of the mobilization, uncertainty increased sharply, which could lead to some flow of funds from deposits to savings accounts, the interest on which does not expire, believes Yegor Lopatin, Deputy Director of the NKR Financial Institutions Ratings Group. At the same time, some investors may expect another increase in rates in the current environment, and therefore tend not to fix the current yield for a long time, he adds.

At the same time, by the end of the third quarter, most banks began to offer the highest rates not for short, but for longer periods, Alexander Borodkin draws attention. Demand for long-term deposits will continue to grow, PSB expects.

“I would rather talk about the growth of savings sentiment not in the context of the urgency of deposits, but in connection with a decrease in consumer activity due to ongoing political and economic tensions. People are starting to save more, which to a certain extent can support the deposit base of banks,” concludes Vladimir Teterin, Senior Director for Banking Ratings at Expert RA. However, while the volume of deposits is reduced – at the beginning of October by 1.55 trillion rubles. less (33.1 trillion rubles) than at the beginning of the year, indicates Valery Piven, Senior Director, Head of the ACRA Financial Institutions Ratings Group. With this in mind, at the end of the year, the growth of deposits may remain within 3-5%, he expects. The dynamics will depend on the stability of the internal socio-economic background, concludes Konstantin Borodulin, director of NRA banking ratings.

Olga Sherunkova, Ksenia Dementieva