“The Race for Depositors”: Deposit Rates Could Reach 17.5%

In September, competition among banks for retail funds is traditionally expected to intensify in the deposit market. Depending on the term, the most common rates on hryvnia deposits will generally range from 13.5% to 16% per annum, while under certain promotional and bonus programmes, returns could reach 17–17.5%.

This was reported by Dmytro Zamotaiev, Director of the Retail Business Department at GLOBUS BANK.

According to his forecast, in September, rates on three-month deposits will most often range from 13.5% to 14.5%, six-month deposits from 14.5% to 15.5%, and nine- to twelve-month deposits will offer around 14.5–16%.

At the same time, the maximum return may be 1–2 percentage points higher than the standard terms. This primarily applies to deposits funded with “new” money, special offers for new depositors, selected terms and deposits opened via mobile applications.

According to the banker, several factors will influence banks’ deposit policies in the autumn: the NBU’s monetary policy, the inflation rate, competition for retail funding, banks’ need for longer-term hryvnia funding and the overall uncertainty caused by the war.

If the key policy rate remains close to its current level, the expert does not expect a significant revision of deposit yields through the end of November. At the same time, competition between banks may be reflected in targeted improvements to the terms of individual products.

“Autumn is traditionally the peak season for the deposit market, but this year competition may be particularly noticeable. After the key policy rate was raised to 15.5%, banks received an additional incentive to maintain the attractiveness of hryvnia savings,” Dmytro Zamotaiev noted.

According to him, depositors are unlikely to see all banks raise their rates simultaneously.

“In September and October, we may see a series of targeted changes: new fixed-term programmes, bonuses for opening deposits online, higher rates for selected terms and offers for new depositors. The most competitive offers may reach 17–17.5% per annum,” the banker concluded.