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Expert: Withdrawal of deposits from banks to continue this month

07.05.2020,15:41


May 7, Fineko/abc.az. Companies and people will continue to withdraw their savings from banks this May.

Expert Samir Aliyev informed about that news agency ABC.AZ, when commenting on the increase in the share of protected deposits by the Azerbaijan Deposit Insurance Fund.

He noted that the population returned its savings, turning some of them into US dollars, and re-placed them in banks. As an example, the expert cited a small increase in deposits in US dollars: "But there is a decline in deposits in manats. The population withdrew its deposits, fearing devaluation and closures of banks. This is also the case in non-financial organizations and companies. Companies have also started to reduce their deposits.

I think that the process will continue in May. Caution is also at the root of the increase in the interest rate on insured deposits by the ADIF from 10% to 12%. That is, they are concerned that the population will return its savings. And deposits can lead to a reduction of deposits, which they use as a source for giving loans. As currently, the share of deposits in total lending is 70%. If people take out their savings, there may be liquidity in banks, and at the same time banks may have difficulty lending. There are already difficulties with repayment of loans, and withdrawal of deposits can cause very serious problems in banks."