Review of Deposit Rates at Leading Banks Following the Base Rate Cut
Translated from Russian with the help of AI. Original: Russian version
A review of retail deposit rates at the country's leading banks after the base rate cut, with advice on diversifying across banks and on entering foreign-currency bonds.
Today is 31 January, which means retail deposit rates will change tomorrow. They will fall in line with the base rate, which was cut by 50 basis points.
I analyzed the rates offered by 7 of the top 10 banks. Here are the terms the country's largest banks offer if you open a deposit online.
Halyk Bank:
Nominal rate: 14.15%; effective rate: 15.3%; term: 6 months.
Kaspi Bank:
Nominal rate: 14.1%; effective rate: 15%; term: 12 months.
BCC (Bank CenterCredit):
Nominal rate: 14%; effective rate: 14.9%; term: 13 months.
Forte:
Nominal rate: 14.1%; effective rate: 15%; term: 12 months.
Zhusan:
Nominal rate: 13.7%; effective rate: 14.6%; term: 12 months.
Eurasian Bank:
Nominal rate: 14.23%; effective rate: 15.3%; term: 13 months.
Bereke Bank:
Nominal rate: 14.2; effective rate: 15.3%; term: 12 months.
The most attractive rates are offered by Eurasian Bank and Bereke Bank, with nominal rates of 14.23 and 14.2 respectively for terms of 12–13 months and an effective rate of 15.3%. Halyk's effective rate is comparable to those of the banks above, but it seems to me that there is some trick in the calculation or an error. For example, the effective rate may be 15.25% but rounded up to 15.3%. Its term is also not the longest: 6 months.
The least attractive rates are offered by Zhusan and BCC. Banks expect deposit rates to decline in line with the downward trend in the base rate, but cutting them in advance means losing customers: individuals lock in a rate for a year, and winning them back afterwards is extremely difficult. That is why retail deposits are the most reliable funding base. As a rule, the better strategy is to hold rates at the upper end of the range, because retaining customers is always cheaper than attracting new ones.
Banks with low rates are either fighting to contain costs or scaling back their appetite for lending and do not need liquidity.
I try to diversify across banks myself, and I recommend that everyone do the same.
Those with large deposits can also look at placing funds in bonds on the stock market. The backdrop is currently favorable for entering foreign-currency securities, as foreign-currency rates are high and the tenge is strong.