Deposit rates reach 3 percent

Money. Source: Deutsche Bundesbank/Flickr (CC BY-NC-ND 2.0)

Commercial banks in Estonia have hiked interest they offer on fixed-term deposits several times in the past year, with most of them now offering 3 percent for a 12-month deposit. Banks say the volume of fixed-term deposits has grown notably.

Martin Kõrv, press representative for Swedbank, told ERR that its fourth deposit rate hike of the year brings the return on a 12-month deposit to 3 percent, up from 2.5 percent previously.

Evelin Koplimäe, head of private banking at SEB, said that the bank offers a rate of 3 percent for customers who deposit their savings for at least a year.

Coop Pank offers 3.33 percent on deposits for 18-35 months and 3 percent for those between 1-17 months, CFO Paavo Truu said.

The return is 3 percent for for 12-month deposits and 3.2 percent for 24 months at LHV, while it tops out at 2.5 percent at Luminor.

Bigbank offers 3 percent for a 12-month deposit and 3.5 percent for longer periods, which is 2.8 and 3.5 percent respectively for Inbank.

Deposit returns offered by Estonian banks. Source: ERR

Deposit volumes up sharply

Banks say that interest in deposits has grown sharply.

Swedbank's representative said that fixed-term deposit volumes started growing in September of 2022, with growth coming to more than 22 percent since then. Private customers' fixed-term deposit volumes have grown by 38.2 percent on year, while money kept in open bank accounts has shrunk by 13 percent.

Koplimäe said that fixed-term deposit volumes have grown by roughly 50 percent for SEB compared to the same time last year.

This grows to 85 percent in the case of LHV, which saw €89 million worth of fixed-deposit contracts in January and €69 million in February.

The bank's representative Kadri Haldre said that while private individuals tend to keep money in longer-term deposits, while companies usually go 3-6 months.

Bank of Estonia statistics show that fixed-term deposit and savings volumes started growing in September. Growth reached 10.5 December to January.


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Editor: Marcus Turovski

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