The Household Deposits are Higher than KM 11 Billion

October 31, 2017

The Central Bank of Bosnia and Herzegovina (CBBH) congratulates to all citizens and commercial banks October 31st – the World Savings Day, which our citizens mark this year with the highest amount of savings deposits recorded so far.

According to the CBBH data, the household deposits account for 57.6% of the total deposits in commercial banks, and with a continuous growth in 2017, at the end of September, they reached the highest recorded level of KM 11.02 billion.

Observing the maturity structure, term deposits and savings deposits in September 2017 amounted to KM 5.44 billion representing 49.4% of the total household deposits, and of which, short-term deposits (with maturities shorter than one year) accounted for KM 504 million or 9,3%, and long-term ones accounted for KM 4.94 billion or 90.7%. Transaction accounts and sight deposits amounted to KM 5.58 billion or 50.6% of the total household deposits.

Over the past five years, there has been a continuing stronger growth of deposits in domestic currency since at the end of 2012, they participated in the total household deposits with 36.4%, and now they have reached almost 50%. Thus, the household deposits in KM currency amounted to KM 5.00 billion and represented 45.4% of the total deposits, while the deposits in euro amounted to KM 5.47 billion and recorded a share of 49.6%. Deposits in other foreign currencies amounted to KM 549 million and had a share of 5% in the total household deposits.

Deposits of households have continued to grow, despite the fact that average salaries and pensions do not record any significant increases. Compared to the situation at the end of September last year, deposits increased by KM 770.9 million or 7.5%. Despite the low interest rates on deposits, citizens continue to hold deposits in domestic banks, which is an indicator of the established trust in the banking sector and the deposit insurance system.

Term and savings deposits are growing at a lower intensity and have increased by around 0.6% (or KM 34.2 million) annually. Considerably faster growth has been recorded in transaction accounts, which, compared to the situation at the end of September 2016, increased by 17.4% (i.e. KM 411.4 million), followed by sight deposits with an increase of 13.1% (or KM 325.3 million).

The World Savings Day marks a remembrance of the First International Thrift Congress, held on October 31, 1924 in Milan, where representatives of the world's savings institutions sought the exit from the crisis caused by the First World War and concluded that savings are the foundation of growth and development.

The importance of savings is undoubtedly high today, as it makes possible for depositors to create reserves for future consumption and possible financial difficulties, while savings, at the same time, create conditions for financial institutions to lend to the real sector of the economy.