The National Bank of Ukraine (NBU) at the 15th auction for placement of three-month certificates of deposit (CDs) at 25% per annum on Friday, July 14, sold them for UAH 26.07 billion, while the volume of redemption of CDs placed at the second auction on April 14 amounted to only UAH 8.87 billion.
As reported on the NBU website, as a result, the volume of three-month DCs in circulation began to grow again and reached a new maximum of UAH 175.44 billion.
The number of buyers, as a week ago, amounted to 43, the regulator specified.
The central bank pointed out that last Friday the volume of overnight DS sales amounted to UAH 355.71 billion, compared to UAH 373.92 billion a week earlier. On the other days of last week, the NBU placed them in the amount of UAH 331.1-337.8 billion.
As reported, the National Bank said on March 16 that from April 7 it decided to lower the rate on overnight certificates of deposit from 23% to 20%, but at the same time to place DCs for a period of three months at a discount rate of 25%, depending on the volume of deposits attracted by banks for a period of three months or more.
On the eve of the debut auction, the NBU set for banks individual initial limits for the purchase of three-month DC at the level of 70% of the balances of individuals’ deposits in the national currency in these financial institutions as of April 4, with an initial term of 93 days or more.
The regulator explained that to the initial limit is added the second dynamic part – multiplied by the multiplier “3.0” increase in the volume of such a portfolio of hryvnia deposits of individuals for 93 days after April 4.
Banks can apply for purchase of three-month DS both from the NBU and in the interbank market within the above limit. The National Bank places them weekly on Fridays.
In the inflation report, the NBU specified that as of April 4, term deposits in the national currency for a period of three months or more were worth the equivalent of UAH 154.5 billion, or 26.9% of all deposits, for a period of up to three months – UAH 40.4 billion, or 7%, while UAH 378.4 billion, or 66%, accounted for demand deposits.
According to the head of the National Bank Andriy Pyshnyy, the share of term deposits reached 35% at the end of May, while the share of deposits with maturities of 3 to 12 months in the total volume of new term deposits increased to 76%.
The NBU also said in mid-June that it plans to study the revision of 3-month deposit multiples in July.
