In September, Banks Actively Attracted Corporate Funds and Continued to Increase Retail Lending
In
September, the banks continued to actively attract deposits. Hryvnia deposits
increased by 1.5% up to nearly UAH 502 billion. This
is shown by preliminary Monetary Statistics Data for September
2018.
The strongest
increase in deposits was seen by retail funds. Persistently high growth in
wages contributed to high inflow of retail deposits in the hryvnia. Thus, at
solvent banks, the retail deposits in the hryvnia increased by 2.8% to UAH
258.7 billion and in foreign currencies (in the dollar equivalent) by 1.4% to
USD 8.7 billion.
In monthly terms
hryvnia corporate deposits at solvent banks barely changed (UAH 242.5 billion),
while foreign currency deposits (in the dollar equivalent) increased by 1% (to
USD 5.3 billion).
Also, banks continued lending to households and corporate sector.The total lending portfolio in the domestic currency
at solvent banks rose by 1.1% to UAH 614.6 billion in September.
In September,
banks actively issued corporate loans: total loans in the domestic currency as
well as foreign currencies (in the dollar equivalent) raised by 1.1% to UAH
485.7 billion and by 1.3% to USD 14.7 billion, respectively.
Over the same
period, hryvnia retail loans rose by 0.9% to UAH 127.4 billion.
In monthly terms, the cost of hryvnia loans and deposits increased for
business, but remained virtually the same for households.
The
hryvnia loans’ rates, mainly corporate, responded to the increase of the key
policy rate, narrowing in liquidity of the banking system, and significant
demand for loans. Thus, the interest rates on
hryvnia corporate loans increased by 1.9 p.p. up
to 19.8% p.a. and for retail loans by 0.3 p.p. to 32.1% p.a
Yields
on deposits for business rose too: by 0.6 p.p.
to 13.0% p.a. At the same time, cost of retail deposits remained unchanged in
monthly terms (10.6% p.a.) as some banks enhanced differentiation
between interest rates on term and demand deposits (caused by the rates
decrease on the latter).
For
more details on money market developments in September 2018, see the Macroeconomic and Monetary Review (October 2018).
