10 Sep 2010 15:26

Deposit rates at top ten Russian banks down to 8.73% in early Sept

MOSCOW. Sept 10 (Interfax) - The top average ruble-deposit rates at Russia's ten leading banks by deposits fell to 8.73% in the first ten days of September, from 8.74% in the final ten days of August, the Central Bank said.

The CB started to monitor deposit rates at the ten banks, which hold around 70% of Russia's personal deposits, in July last year, when the rate was at its highest, 15.02%.

Since then the rate has declined 6.29 percentage points. It is now 4.45 p.p. lower than the 13.18% recorded in the final ten days of December 2009.

The ten banks that the CB is monitoring are Sberbank , VTB24 , Bank of Moscow , Raiffeisenbank, Gazprombank, Rosbank, Alfa-Bank , Uralsib , Promsvyazbank and MDM Bank.

Top Central Bank officials have aired their concerns about aggressive growth in deposit rates as these have a bearing on the conditions for lending to the real sector.

But high rates carry risks for the banks themselves because these fall when inflation slows, as do the rates at which the banks lend, and banks with very high deposit rates could find their interest expenditure exceeds interest income.