The decline rate of deposits is predicted to decrease, according to Georgy Gorshkov.
Hold Those Rubles in High Yield: Retail Ruble Portfolio Rockets by 400 Billion Rubles in March
Hey there! Guess what? The savings market is looking like a pretty sweet place to be, thanks to stable interest rates. In the coming months, you could snag a maximum yield of around 19-20% annually. Yup, you read that right! But don't get too hyped, as further rate cuts are on the horizon, but at a slower pace. This tidbit comes straight from Georgy Gorškov, Deputy President and Chairman of VTB Bank.
Hot off the press, the Central Bank kept that key rate at a staggering 21% for the fourth time in a row. The wait for a potential decrease may stretch into the second half of the year, as major inflationary factors remain unyielding.
The Savings Market is Smokin' Hot
The retail market is heating up! According to the regulatory bod, the total ruble portfolio grew a whopping 400 billion rubles last month, all thanks to an increase in time deposits. On the downside, maximum deposit rates slipped about 0.6 percentage points in March, as per the Central Bank of Russia (CBR). But fear not! The smart money says that these rates will stabilize at the splendid 19-20% per annum range in the next one to two months.
With recent rate cuts in February and April, market participants might take a wait-and-see approach, weighing their liquidity needs against the potential for further cuts. But fret not, as there's still a solid opportunity to rake in some high yields on your savings products.
No Change on the Borrowing Front
On the flip side, interest rates on personal loans are staying put. Given that the Central Bank is expected to keep its tight-fisted policies in place for most of 2025, we don't expect a change in the short term. mortgage rates will continue to float above 25%, keeping demand down. So, government programs are likely to continue leading the pack when it comes to bank lending.
VTB plans to stick with their current pricing for retail loans, but if market funding costs plummet despite the key rate holding steady, they might drop a few goodies for mortgage and personal loans to stay competitive. The auto lending segment may see regular changes based on market conditions and automaker subsidies.
Two-Thirds of Deposits Grabbed at Peak Rates
Bonus tidbit: remember those peak rates we mentioned earlier? Well, it's believed that two-thirds of deposits were opened at those rates, stiffening the retail market's stance.
- Stability in interest rates is providing a lucrative environment for the savings market, with high yields of around 19-20% annually forecasted by VTB Bank.
- In comparison, personal loan interest rates remain stagnant as the Central Bank maintains its tight-fisted policies, and mortgage rates continue to hover above 25%.
- Despite the downward trend in deposit rates, the retail market has experienced substantial growth, with a 400 billion ruble increase in March, as per the regulatory body.
- Interestingly, it's estimated that approximately two-thirds of deposits opened were at peak rates, contributing to the stability of the retail market.
