And this may mean no loans for Belarusians.
In August, residents of Belarus withdrew 975.4 million rubles from their ruble deposits, and 624.3 million dollars from foreign currency deposits. The National Bank joined the population and limited its support to banks, which, in turn, reduced the issuance of loans to the population, and raised the rates on deposits. How long will it last?
The situation with ruble deposits looks rather unpleasant. In August, transferable deposits of the population, that is, mainly, funds on bank cards of individuals, decreased compared to July by 704.6 million rubles and amounted to 2.67 billion rubles. Time deposits in rubles decreased by 270.8 million rubles - to 4.65 billion rubles.
The population bought currency at the expense of funds for current expenses
This money, no doubt, went mainly to buy foreign currency. From the above values, it follows that the purchase of foreign currency in August by the inhabitants of Belarus was carried out, for the most part, at the expense of funds intended for current expenses, and not long-term savings. Basically, the population took money from current accounts, that is, they spent their salaries on the purchase of foreign currency. As for long-term ruble savings, that is, term deposits, they decreased by only 5.5%. This is relatively small.
In August, Belarusian enterprises also actively took their funds from banks. The amount of money on their fixed-term ruble deposits decreased by 547.8 million rubles - to 3.63 billion rubles, and transferable deposits decreased by 62.5 million rubles - to 2.81 billion rubles.
Thus, the ruble money supply in the Republic of Belarus in August fell by about a tenth - 1.7 billion rubles, and amounted to 17.85 billion rubles as of September 1.
The banks' need for Belarusian money was partially satisfied by the National Bank, which stopped lending to banks every day, but organized auctions to place its funds for 7 days on Wednesdays. So, at the auction on September 2, it provided banks with 1.11 billion rubles, and they asked for 1.57 billion rubles. At the same time, on September 14, the National Bank extended for a month the refusal to provide loans to banks for a day.
Thus, the National Bank does not seek to satisfy the demand for Belarusian rubles in full, although nothing prevented it from doing so. This means that the pressure on the ruble exchange rate worries it much more than lending to the population and enterprises and supporting the economy. This, in principle, is not surprising, because it has been pursuing a similar policy for the past several years.
Interest rates on short-term foreign currency deposits are growing rapidly
The currency funds of the population and enterprises in banks in August decreased to a lesser extent than the ruble ones: by $ 375 million. At the same time, individuals took $ 624.3 million from banks (8.8% of all their foreign currency deposits), and they had $ 6.48 billion left in the banks.
Transferable deposits of the population, that is, their money on foreign currency bank cards, decreased by $ 208 million (to $ 1.33 billion). Time deposits decreased by $ 416.2 million (to $ 5.15 billion).
Such a significant withdrawal of deposits was caused by the political crisis. In addition, it is affected by the fact that rates on fixed-term foreign currency deposits remain at an extremely low level. This was achieved by the National Bank, which decided in this way to stimulate the transfer of foreign currency deposits into rubles. It did not succeed with this, but the National Bank stimulated the outflow of foreign currency deposits of the population from banks. Banks are now trying to slow down the outflow of deposits, for which they increase interest on deposits. Thus, the average rate on new deposits of individuals for up to 1 year in August rose to 0.74% per annum from 0.57% in July. But a similar rate on new long-term deposits even dropped to 1.58% from 1.72%. This indicates that the banks do not anticipate the crisis to persist in the long term.
The outflow of foreign currency deposits of the population in August was largely offset by the inflow of deposits of legal entities by $ 249.3 million - up to $ 5.01 billion.
However, in general, the banks lost quite a significant amount of foreign exchange resources over the month, which caused concern of the international rating agency S&P, which changed the “stable” outlook for the credit ratings of Belarus to “negative”, leaving the long-term and short-term sovereign credit ratings of the country unchanged at level B.
S&P experts believe that if events develop in Belarus under a pessimistic scenario, the National Bank's foreign exchange reserves may be depleted. At the same time, they noted that the debt problems of Belarus can be resolved in the event of a positive outcome of negotiations with Russia.
It really happened. During a September 14 meeting with President of Belarus Aliaksandr Lukashenka, Russian President Vladimir Putin announced the allocation of a government loan to Belarus in the amount of $ 1.5 billion. This will be enough to refinance the Belarusian debt to Russia, and there will be another 0.5 billion dollars left to support the ruble and banks' exchange rate. And this is quite enough to support the currency liquidity of the banking system of the Republic of Belarus, with considering that the outflow of currency from banks after August should slow down.
S&P experts downgraded their forecast not only regarding the stability of Belarusian finances, but also placed the ratings of Belarusbank, Belagroprombank and Bank BelVEB on the CreditWatch Negative list, that is, ratings that are under revision with negative expectations.
The reason for this decision is the same as for the decision regarding the rating of Belarus as a whole: an outflow of deposits and an increased demand for foreign currency. The agency expects to withdraw the ratings of banks from the list for revision in the next three months if it becomes clearer about what is happening in the financial system of the Republic of Belarus.
Forecast: outflow of deposits will be replaced by an inflow
In principle, the clarity has already arrived. Since the inhabitants of the country need Belarusian rubles for life, people are currently selling the currency they bought in August. Due to the depreciation of the dollar, they will lose some money. Therefore, in September, after receiving their salaries, they are unlikely to buy foreign currency in the same volumes. This will lead to an increase in household funds on transferable ruble deposits in banks.
As for time deposits in national currency, they are likely to decline, but not much - by a few fractions of a percent per month. The fact is that those people who wanted to withdraw their money have already done so. And there will hardly be many new applicants, since in the conditions of a depreciation of the dollar, it is unprofitable to withdraw ruble deposits.
The rate of decline in the value of foreign currency deposits should also slow down sharply. The reasons are the same: those who wanted to withdraw currency from banks have already done this. This process will also be hindered by an increase in interest rates on foreign currency deposits for up to 1 year. An increase in export earnings is also possible due to some recovery in world trade (despite the second wave of the epidemic). In addition, the allocation of a Russian loan to Belarus in the amount of $ 1.5 billion should calm the mood of both individuals and legal entities.
Thus, the outflow of ruble and foreign currency funds of depositors from banks in the remaining few months of this year is likely to stop, moreover, it should be replaced by an inflow. Unless, of course, new force majeure events occur.
Uladzimir Tarasau, Belrynok