The aggregate amount of retail deposits in January-September 2009 stood at 1 861.5bn tenge and increased by 304.5bn tenge or 19%, as compared to 1 557bn tenge over the analogous period in 2008. Experts think that the deposit base will continue increasing in the first quarter of 2009.

There is a trend on the Kazakh market of a growing deposit base. It has been growing steadily over the past few years and reached its peak in October 2007 (6 274bn tenge). In January 2008 the base declined by almost 40%.

Denis Rybalkin, an expert from KzRating, said that the growth rate is continuing, with a slight drop in early 2009.

The volume of retail deposits increased for almost all second-tier banks. For example,  Temirbank term retail deposits stood at 43.9bn tenge in January-September 2009 while in the analogous period in 2008 the bank drew 41.9bn tenge, so there was a 4.8% increase in deposits over the nine months in 2009.

According to Baurzhan Sadykov, Head of product development division of Eurasian Bank, in October 2009 the total amount of retail deposits stood at 77bn tenge, a 100% increase compared to last year.

According to Sberbank Rossii, on 1 October 2009 the balance of term retail deposits equalled 33 534.32mn tenge, an increase of 24 204.37mn tenge or 259.42% since the beginning of the year. Compared to last year, the deposit base increased by 1 141.53mn tenge or 14.68%.

Managing director of Kaspi Bank Pavel Mironov thinks that the increase in deposits at second tier banks is due to market changes over the past two years, when the population’s trust towards banks increased.

The retail deposit forecast is positive at the beginning of 2009. Eurasian Bank plans to boost the amount of retail deposits to 80bn tenge by the end of the year; Temirbank plans to raise 15bn tenge and Narodny Bank plans to raise 6bn tenge in September- December 2009.

The banks are more conservative in their estimates for next year. Eurasian bank plans to maintain its deposits at 2009 level, including the fourth quarter increase. Alexandr Naumov, Head of retail business development said that deposits will increase in 2010 by 5 965mn tenge.

Saule Isina, Director of retail business at Temirbank, says that considering the overall market situation, the bank plans to maintain its deposit growth in 2010 and maintain at least the same market share. The bank also plans to maintain its current clients and prevent deposit withdrawals. Ms. Isina noted that the bank takes into account many factors when calculating retail interest rates, including market rates for analogous products and maximum rates allowed by the Kazakh Deposit Insurance Fund for second-tier banks. The bank will calculate the rates taking into account all these factors.

Denis Rybalkin commented that the banks are provoking the domestic rate increase as they try to refinance their external loans domestically. The banks response is that an increase or decline of interest rates will directly depend on the situation on the Kazakh deposit market.

Alia Ibraeva

Kursiv