Kazakh Deposit Insurance Fund to raise deposit rates

Finance Materials 9 May 2019 13:22 (UTC +04:00)

Baku, Azerbaijan, May 9


Starting from June 1, 2019 the Kazakh Deposit Insurance Fund (KDIF) will raise the maximum rates of time and savings deposits that are non-tenge denominated and are placed for a period of 12 months, Trend reports via the press office of the Fund.

Furthermore, the ceiling rate of revocable deposits, as well as of time and savings deposits that are placed for a period less than 12 months the rate will still be of one percent.

KDIF explains the decision with a number of reasons. Firstly, the change is due to the formation of market rates of non-tenge deposits.

“Today, the foreign market and the finance institutions rates of deposits placed in foreign currency prevail over the rate of KDIF, which amounts to one percent,” the report said.

The effect of de-dollarization and the formation of the yield curve of the deposits on the principles of time and stability are also among the reasons for the decision.

“The increase of the rate of the long-time deposits with limited revocability right will allow to develop the unified management approach in setting the differentiated maximum rates based on the type of the deposit in analogy to the tenge-denominated deposits, as well as to develop the stable base for banks funding,” reads the message.