With
strongly negative interest rates
in the last two months, fixed-term deposits have begun to show signs that
they are no longer the favorite investment of Argentines
.
In January, savers preferred to dismantle positions in banks after the devaluation jump and with an exchange gap that had started the month at a minimum.
Term placements fell 19% real monthly in January,
which extends the dynamics seen the previous month.
"Interest rates well below inflation explain this result. In annual terms, term loans drop by 55.9% in real terms," the consulting firm LCG highlighted.
What happened with fixed terms is part of a
fall in all deposits
in pesos.
Although at the start of 2024 demand deposits grew by 4.6% in real monthly terms, the stock of pesos in banks accumulated a real decline of 8.3% compared to what was seen at the beginning of 2023.
On the one hand,
inflation "eats" the savings capacity
, especially of retailers.
But at the same time, the
Central Bank's
rate policy
discourages any type of placement in pesos
.
Savers and companies
prioritize liquidity
to be able to migrate towards shorter-term placements, although these also have negative returns.
"A process of
demonetization of the economy
continues , also encouraged by an expansive monetary policy bias of negative rates," they noted in LCG and added: "In this
context of high inflation, which discourages the holding of money without remuneration,
it is to be expected that by 2024, demand deposits will continue to evolve below the price level of the economy, and that they will gradually migrate to remunerated demand accounts,
through the transfer of funds to the FCI
money market."
Fixed terms tied by inflation also fell
in the first month of the year, because the Central Bank decided to extend the minimum time for their placement to six months.
But the trend, in this case, could be reversed: "The fall in the previous months has been so great that it is possible that it will slow down, due to captive agents in pesos who have difficulties accessing other savings methods."
The "B side" of fixed terms in banks is the placement of credit for the private sector.
Loans also showed a drastic drop
in the first month of the year and accumulated
three consecutive months of collapse
.
If you look at the stock of loans in banks, the accumulated fall in the last twelve months is greater than 32% in real terms.
“
The private sector is moving away from banks as its source of financing
and a strong adjustment is seen in the values of the activity. To show this, it is enough to consider that the total financing to the private sector in pesos granted by the entire system financial is below 15,000 million US dollars measured at the MEP price,” explained Guillermo Barbero, Partner at First Capital Group.
Personal loans vs.
Credit cards
All credit lines fell in January.
Consumer financing loans did so at a slower pace
than they had shown in December: personal loans and credit card financing fell 12.7% and 10.9% in real monthly terms, respectively.
“Banks are once again turning their attention to this product with offers and promotions, but it is very far from its historical levels.
In the recent past, personal loan levels competed in volume with credit cards,
representing 50% each. segment;
Currently we see that
the relationship is 75% for cards and 25% for personal loans
,” Barbero said.
The specialist announced: "It is expected that the use of the Cuota Simple program, which replaces the Ahora 12 programs, will allow the card portfolio to be recovered. The rise in product values is faster than the income of cardholders and therefore Consequently, the
updates of the credit limits
, for this reason, the growth in real terms
of the portfolio
is difficult .”
NE