Personal savings come to a grinding halt despite rising interest

The rise in the number of deposits opened by individuals in the local currency, the leu (RON) slowed down this July, for the second consecutive month, to 23% compared with July 2007, the lowest rate since end-2006. The appetite for forex savings has also diminished over the past months, but the slowdown was less visible. Compared with July 2007, forex deposits are now 34.9 percent higher when stated in euros, with the growth pace keeping close to that of the previous month, according to data with the National Bank of Romania (BNR).
The decline is said to be partially the result of the reporting being made against a larger comparison base. Nevertheless, monthly rises also indicate diminishing interest in savings, even if the banks have increased the interest they pay on RON deposits to over 10-11% per annum, which means 2% higher then inflation. Interest paid on euro-denominated deposits also rose significantly, frequently exceeding the 5 percent per annum rate.

Analysts say this July’s slowdown reflects a seasonal component as well, given that the population consume more while on vacancy and replenish their coffers in autumn. And yet, the paper notes, savings managed to take off in July 2007.
RON deposits would record year-on-year real term increased of 45% on a monthly basis.
At the same time, forex deposits would advance 50.5% in July 2007 from June 2007. This year, July witnessed stagnations in RON deposits, and a slight advancement in forex deposits; when stated in RON, the slight increase becomes decline under the influence of the appreciation of the leu.
The annual growth rate of RON deposits this July was almost 18 points below December 2007’s 41%.
Even compared with June, the growth slowed down suddenly, being more than 4% below December 2007’s 46% rate.
Data with the BNR also indicates that there were less personal loans taken out in July. The paper argues that the following months will show whether it was about a temporary slowdown or because of the vacation times or because Romanians no longer have money to save and neither the possibility to take out more loans because they are already in debt to banks.
The paper remarks that the slowdown in loans his July occurred even before the application of new restrictive loan regulations by BNR that will come in force in early October only.

Citește și

Spune ce crezi

Adresa de email nu va fi publicata

Acest sit folosește Akismet pentru a reduce spamul. Află cum sunt procesate datele comentariilor tale.