Russians began to invest more frequently in Chinese yuan instead of euro. This topic will be discussed at the 14th VTB Investment Forum “RUSSIA IS CALLING!” said VTB Deputy Chairman and Chairman of the Board of Directors Georgy Gorshkov, referring to statistics on the bank’s customers.
By the end of January-November 2023, VTB customers’ savings portfolio in Chinese currency more than doubled, reaching 12.7 billion yuan. As a result, depositors’ share of foreign currency savings exceeded 24 percent and “exceeded” the 17 percent share of the euro. Gorshkov explained that a similar trend is typical for the banking market as a whole. According to VTB forecasts, by the end of the year “China” will likely account for more than 25% of customers’ foreign currency savings, becoming the second most popular currency for savings.
The first place in the currency “wallet” of Russians is still the dollar. But citizens are gradually withdrawing from the American currency. Investors try to convert their existing savings into dollars and euros and for this purpose they mainly prefer ruble products. They already occupy around 90% of VTB’s retail savings portfolio.
“The main interest of depositors today is focused on high-yield ruble deposits. Despite the increase in interest rates, banks’ offer of record population rates for this year caused a strong wave of demand from individuals. Russians also choose currencies of friendly countries, especially the yuan, to diversify their existing funds. We estimate that by the end of the year, individuals’ savings portfolio in Chinese currency on the market will increase by 60%, reaching 70 billion yuan,” Gorshkov said.
In early November, VTB increased deposit rates in Chinese currency. Their returns reach 3.8% annually.
The Central Bank of the Russian Federation increased the interest rate by 200 basis points to 15% annually on October 27. After that, banks began to increase deposit rates, especially ruble deposits. Now the maximum return on deposits in national currency reaches 17%.
Previously at the Central Bank said “socialbites.ca” about the increase in the amount of money deposited by Russians.