OREANDA-NEWS. On 19 March 2009 was announced, that according to the NBU, the deposits amount fell by 5.6% or UAH 19.0bn to UAH 320.5bn in February 2009. In particular, the amount of retail deposits dropped by 5.5% or UAH 11.4bn to UAH 196.3bn, while corporate deposits fell by 5.7% or UAH 7.5bn to UAH 124.2bn. At the same time the amount of loans diminished by a moderate 0.6% or UAH 4.6bn to UAH 717.9bn in February 2009. Additionally, the amount of cash reduced by 1.8% or UAH 2.7bn to UAH 147.5bn. This resulted in the money supply drop of UAH 22.0bn in February 2009, while monetary base reduced by only UAH 6.6bn.

As could be predicted the deposits amount continued reducing in February 2009 related to the negative population expectations concerning the financial stability of the domestic banks. At the same time Millennium Capital explains the increase in the corporate loans in the national currency to be funded mainly from the NBU’s refinancing (UAH 7.2bn in February). This is also confirmed by the fact that, the monetary base decreased in February, despite that the commercial banks were expected to increase the required reserves by at least UAH 4bn in that month, according to our estimations. Additionally, the commercial banks could repay the deposits maturing in February via the funds received from the NBU’s purchase of the government bonds in February (UAH 2.7bn), as well as from the external loans provided by the parents of the commercial banks.

Millennium Capital is an integrated financial services provider. Established in 2000 by a group of professionals with solid background in securities and corporate finance, Millennium Capital is now one of the major investment banking institutions.