For example, the Savings bank has increased hryvnya deposit profitability by 4% at once. A little less – by 3% - is the hryvnya deposit reduction in Rodovid Bank. ‘Nadra’ and ‘Finance and Credit’ banks have started to pay their customers by 1.1 – 2.2% annually more at all three main currencies. Middle and small banks keep up with the large financial institutions. Thus, Megabank, ‘Credit-Dnieper’ and Diamondbank have raised the deposit rates for some programs by 0.5-1.5%.
Everyone will raise
Deposit rates will have to be raised even in those banks that didn’t intend to do it. ‘Those financial institutions which don’t experience liquidity deficit will probably review profitability of their programs in order not to lose their market share,’ – says the President of Reiffeisen Bank Aval Vladimir Lavrenchuk.
But this is not the last bad news for depositors. According to experts’ forecasts, by the end of this year deposit rates will have risen by some more percent. ‘By the end of summer months the current level of bank deposit rates will remain the same. And by the end of this year it is most probable that they will increase by 1-2% annually at all currencies,’ – forecasts the head of deposit operations department of Praveks-Bank Svetlana Kramarova.
The analyst of ‘Prostobank Consulting’ company Alexander Sedykh is of the same opinion. ‘According to my forecasts, by summer the deposit rates may rise by 0.5%. Then there will be slack connected with the season factors. And by the end of the year the growth of the rates will continue – 1.5-2% annually for USD deposits, 1% for UAH deposits, and around 0.5-1% for EURO ones.’
However, even after increasing the rates the profit from deposits will not always cover inflation. Thus, if to believe the forecasts of the World bank and International currency fund, according to which inflation in Ukraine by the end of 2008 will not exceed 17.2%, separate deposit programs will allow the depositors to ‘come to zero’ – to earn nothing, to lose nothing. And only the luckiest will be able to clean up 1-2% annually.
Profitable programs
One of the most profitable offers to depositors is given by Delta Bank. Using the program XXL a customer can count on 18% in the national currency, and 13% annually for USD deposits. Minimal deposit amount is 2.5 thousand hryvnyas, or 500 US dollars, for the term of 1 year.
In case of putting the money into ‘Capital’ deposit in Ukrprombank in a year’s time a customer will get 15.5% in hryvnyas, and 11.9% in US dollars. However, the minimal initial fee is higher here than in Delta Bank – 5 thousand hryvnyas, or 1 thousand US dollars. High profitability from euro currency deposits is offered in ‘Credit-Dnieper’ bank – 12.5% annually (‘Progressive’ deposit), ‘Nadra’ bank – 10.3% annually (‘My Choice’ program), and also Universal Bank – 10.25% annually.
Hryvnya is best of all
If to choose from three currencies, it is the best to deposit in hryvnyas. USD deposits against a background of weakening American currency has got nothing good ahead here. Its recent fall at the cash market to the level of 4.7-4.8 hryvnyas per one dollar is a good proof of it. Besides, despite constant assuring of the National bank that we will not strengthen hryvnya with respect to US dollar, there remains such probability.
As for euro, it is not so clear here too. The European currency has strengthened for the last six months very much, and now, according to many analysts, it’s at its peak. Of course, it’s quite possible that euro rate will rise by 5-10% more, but it’s not worth risking – not so high euro deposit interest rates are offered in our banks.
So, hryvnya is the best variant for savings. And the main financiers of the country to the question ‘What currency do you save your money in?’ answer all at once, ‘In hryvnyas.’
