The period of placement of ruble funds of legal entities on deposits is lengthening, while foreign currency funds are being reduced

The period of placement of ruble funds of legal entities on deposits is lengthening, while currency funds are being reduced, follows from the data of the Central Bank. Bankers confirm the trend. According to experts, it is connected with the stabilization of the economic situation and the low profitability of foreign currency deposits.

In the first half of the year, the largest share of ruble funds of legal entities – up to 40% (11 trillion rubles) – was on short deposits for less than 30 days, while the share of funds on long deposits over three years was 7% (2 trillion rubles), follows from the data Central Bank. But the share of funds in rubles on short deposits showed a decrease by 10 percentage points by the beginning of June. The maximum share of funds of legal entities of banks in foreign currency fell on long deposits – up to 71% (4 trillion rubles) and also decreased by 10 percentage points by the first month of summer, follows from the regulator’s data.

In parallel, corporate clients of banks are replacing the dollar and the euro with yuan. Thus, according to the Central Bank, by the beginning of June, the share of unfriendly currencies decreased to 58% of the total volume of foreign currency deposits, while at the beginning of the year it exceeded 76% (see Kommersant dated June 13, 2023).

Bankers and experts confirm the trend. So, the chief analyst of Sovcombank Natalia Vashchelyuk notes that the share of ruble funds of legal entities placed for up to 30 days decreased from 41% to 31%, while on deposits for a period of 30 to 90 days it increased from 24% to 33%. Other banks from the top 10 did not respond to Kommersant’s inquiries. Short-term ruble deposits for up to 30 days decreased by 2.8 trillion rubles, but by 2.5 trillion rubles. increased balances on deposits from 31 to 90 days, said Natalia Bogomolova, an analyst at NRA banking ratings.

According to experts, the trend is associated with the stabilization of the economic situation. “Macroeconomic stresses have led to a shortening of the investment horizon,” explains Ivan Uklein, director of banking ratings at Expert RA, “Legal entities maintain balances on current accounts for settlements, and the liquidity surplus is placed in short-term deposits.” The share of foreign currency deposits is generally low, while short-term products bring very low returns – the corporate sector needs the currency mainly for settlements, and not for savings, continues Mr. Uklein.

According to independent expert Andrei Barhota, last year the nominal yield in dollars and euros went into negative territory, these currencies were actually absorbed in the money market. Deposits in yuan are gaining popularity, but even in the future, this is far from the share that foreign currency liabilities occupied until 2022.

As a result, the profitability of foreign currency deposits does not strongly depend on the time horizon, while the transactional function of the currency is reduced to a minimum. In such a situation, corporate clients prefer to have foreign currency on their accounts to implement the tasks of foreign economic activity, the expert explains. “Clients saw how confidently the domestic banking sector passed the period of instability last year, which contributed to increasing the potential for increasing the deposit base,” says Mr. Barkhota.

Experts believe that the trend will continue and the popularity of long-term deposits will increase. As the gap between long-term and short-term deposits widens (now it is 0.5-1.5 percentage points), interest in long-term products will grow, Mr. Barkhota notes, explaining that these processes are stimulated by rising inflation and interest rates.

Anna Avakimyan, Chief Analyst of Regblok, draws attention to the fact that over the six months of 2023, the key rate of the Bank of Russia has not changed: raising the key rate of the Bank of Russia by 0.5–1 percentage points”.

Julia Poslavskaya