Deposits in banks reach an all-time high of 42.5 trillion tenge.
Revised Article:
Boom in Bank Deposits: A 2024 Kazakhstan Trend
In 2024, bank deposit portfolios surge by a staggering 7.4 trillion tenge (+21.1%), with retail deposits leading the charge, as per our site's report. This growth rate more than doubles the pace of bank deposit growth witnessed in 2023. As a result, the total deposit volume skyrockets to a record-breaking 42.5 trillion tenge.
The growth momentum mainly stems from a spike in tenge deposits, according to the-tenge.kz. Notably, personal deposits observe a massive increase of 4.2 trillion tenge, marking a +30% year-on-year rise. Interestingly, December 2024 sees a significant surge in personal deposits (+1.5 trillion tenge).
The significant growth in retail deposits can be credited to the two major players – Halyk Bank and Kaspi Bank, which account for over half of the overall deposit increase among second-tier banks. Other banks, though, exhibit more modest growth rates.
Meanwhile, corporate deposit growth reaches 3.2 trillion tenge.
However, the average deposit cost remains nearly half the base rate, due to several factors. First, the foreign currency component of the deposit portfolio puts downward pressure on the average rate, as the yield on such deposits seldom exceeds 1%. Second, a few large banks secure substantial volumes of cheap funding from quasi-state companies, which dilutes their average resource acquisition cost, the article notes.
Understanding Kazakhstan's Banking Landscape
Kazakhstan's banking sector operates under a two-tier system, with the National Bank of Kazakhstan (NBRK) acting as the central bank, and commercial banks forming the second tier. Major banks include Kaspi Bank, Halyk Bank, Bank CenterCredit, Jusan Bank, and Eurasian Bank. The sector has experienced considerable digital transformation, emphasizing mobile banking, internet payments, digital wallets, and fintech solutions.
Factors Shaping the Future of Bank Deposits
While specific data for 2023 and 2024 is scarce, the competitive banking environment and swift digitalization in Kazakhstan probably fueled increased retail deposits. Kaspi Bank, for instance, leading the digital commerce and payment solutions sector, might have attracted more retail customers.
** Contributing Factors:**
- Digital Advancement: The widespread adoption of digital banking platforms and rapid growth in internet penetration and smartphone usage underlie deposit growth.
- Fintech Innovation: The burgeoning fintech startup scene in Kazakhstan offers innovative financial solutions that contribute to higher deposits.
Influencing Factors:- Interest Rates: Interest rates set by the National Bank of Kazakhstan have a significant impact on deposit costs as banks need to offer competitive rates to attract depositors.- Inflation and Economic Stability: Lower inflation (from 9.8% in 2023 to 8.6% in 2024) suggests economic stability, which impacts deposit costs by affecting deposit demand and the overall economic climate.- Competition: The competitive banking landscape, driven by digital transformation and fintech innovations, can lead to increased costs for banks as they vie for deposits by offering better rates and services.
- The surge in personal deposits, observed as a +30% Year-on-Year rise, could be attributed to the digital advancement in Kazakhstan's banking sector.
- The significant increase in retail deposits, driven by fintech innovations, probably contributes to the business sector's growth, specifically in personal-finance management.
