Long-term deposits increased largely because banks slashed interest rates offered for short-term deposits.
Long-term deposits therefore account for more than 10% of consumers’ savings in banks, 2 percentage points above the January 2013 level. The overall deposits rose by merely 1%.
The banks left without cheap lines of credit from abroad were forced to look for long-term cash on the local market during the crisis, offering higher interest rates to customers choosing to put their money in a two or even three-year deposit. At the same time, the liquidity surplus on the market allowed banks to slash rates for one to three-month deposits.
As a result, those who deposit money in the bank for one, two or three months, end up getting back less than they deposited because the interest rate no longer covers the fees.
This prompted the central bank to urge banks to clearly inform their customers of the costs of a deposit.
Total deposits made by individuals in banks amounted to RON105 billion, in addition to current accounts and savings accounts, which held another EUR27 billion at the end of January. (EUR1=RON4.4931)
(English version by Loredana Fratila-Cristescu)