Deposits of the population may grow up to $1 bln by the fall of 2001 - NB

/IRBIS, May 23, 00/ - REUTERS informs, with the reference to the chairman of the National Bank, Grigorii Marchenko, that volume of the deposits of the population in the Kazakhstani banks may reach $1 bln by the fall of 2001, the amount expected by the National Bank, however, financial sector is facing with the problem of investing the free funds. He added they were fulfilling their task of accumulating the funds of the population, but the problem of reliable borrowers, and the interaction of the real and financial sector had to be solved. The National Bank informs that from the beginning of the year the deposits grew 16.1%, up to $448 mln. Together with pension accumulations of $553 mln total accumulated funds of the population exceeded $1 bln in May of this year, is said. However, financial sector is facing with the problem of investing these funds, since, according to Marchenko, there are only about 30 solid borrowers in the country - mainly big enterprises, oil, metallurgical, mining companies- exporters that are financed by the banks at lower rates already. The major class of the borrowers is middle business, though due to opacity and absence of good business-plans they are highly risky for the banks. The chairman of the National Bank believes the trust of the population in banking sector has improved as the fund for collective insurance of time deposits has been established with the participation of 16 banks, and still some other banks are willing to join. Based on the data of the National Bank, major growth (37%) took place without considering the Halyk Bank where most of the deposits are concentrated. If Halyk Bank was active in attracting the deposits of the population with its developed network, then the growth would be twice as much, said the chairman. By the information of the National Bank as of May 1, commercial banks had accumulated 55.7% of the deposits, while Halyk Bank had accumulated 44.3%, including more than 80% in tenge deposits, and 28% in hard currency deposits. The rates are also falling, which is believed to be a result of the creation of the fund for collective insurance of the deposits. Marchenko believes the rates on hard currency deposits will fall to 7-9% by the end of the year from current 9-11%, and that of tenge deposits down to 12-18% from 16.5-20.0% now. The chairman added that refinancing rate would fall down to 12% as the inflation lowers to 9% or less and if everything goes right.