JSC Unibank Attracts Dollar Deposits

JSC Unibank raised the annual interest rate on term deposits in US dollars to 14% (+ 1.5%).

In fact, the financial structure takes urgent, progressive and cumulative deposits, while time deposits have a minimum amount of 500 manat, euros or dollars.

According to the law, to avoid loss of deposit in case of bankruptcy of the bank and get full compensation from Azerbaijan Deposit Insurance Fund (ADIF), the investor must open an account at the rate of 9% in manat. However Unibank decided to draw dollar deposits by increase in the size of the annual rate.

According to the expert economist Azer Mehdiyev, this effort aims to stock up dollars on the weakening euro and other currencies. The bank is active in the European market, because it wishes to attract hard currency to which, by the way, manat is tied. Moreover, the population today is not at risk of dollar deposits, since it is still the only kind of investment, coupled with a minimum of risk.

"However, there is a contradiction - the President at a government meeting on the socio-economic development at the end of three quarters of last year ordered the government to prepare the ground for reduction of interest rates on consumer loans. The decision of a private bank, whose activities are linked to USD, about raising the annual deposit rates means that its leadership is not going to cut interest rates on consumer loans due to the disadvantages," said the expert. --17D-