Romanians" savings shrink

The total value of deposits reached 283.8 billion lei in Q1 2011, down 13.1 billion lei, compared to the end of last year, according to data from the Fund for the Guarantee of Deposits in the Banking System.

As to what concerns the dynamic of the deposits according to the currencies that they are denominated in, deposits in lei fell 7.3 billion lei, whereas deposits in foreign currencies fell 5.8 billion lei. This dynamic was supported by the appreciation in real terms, in the first quarter of the leu, against the Euro and the American Dollar.

In Q1, deposits of the population reached 106.1 billion lei, up 3.5% YOY. Given the annual inflation between March 2010 and March 2011, the value of the population"s deposits fell 4.2% in real terms.

Depositors chose to keep their savings in lei, even though the interest rate for deposits denominated in the national currency fell. As for the reduction of the deposits denominated in lei, this is caused by the strengthening of the national currency, as well as due to the reduction of the interest rate for term deposits.

On March 31st, deposits of companies reached 177.7 billion lei at the end of March, which amounts to a quarterly decline of 7% (down 9% in real terms), representing the main cause of the contraction of the total volume of deposits in the banking system. Companies" savings denominated in foreign currencies shrank 4.8% (down 6.8% in real terms), reaching 92.7 billion lei. Savings in lei shrank more than those denominated in foreign currencies, 9.2%, (11.1% in real terms), to 85 billion lei.