The CBR, MinFin and DIA have agreed to increase payments to the Deposit Insurance Fund to 0.14% from 0.1% (per quarter) for banks with deposits with interest rates that exceed the maximum level established by the CBR (the maximum retail deposit rate at the top-10 retail deposit taking banks + 200bp), Vedomosti reports. It was previously announced that the government had agreed to increase the insurance sum to RUB 1mn from current RUB 700,000.
This measure is fair, in our view, and will partially reduce the risks in the system, pushing banks to cut their most expensive deposits. We expect interest rates to grow further by the year-end, with banks competing for funding. That would keep the structural pressure on banks' margins (especially for Sberbank) intact.
Mikhail Shlemov, Svetlana Aslanova
VTB Capital analyst
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