Government Saving Bank gave away 550,000 commemorative piggy banks to customers yesterday. PATTANAPONG HIRUNARD
Savings rate is expanding at a slower pace compared to previous years largely due to lower annual salary increments, the Government Savings Bank (GSB)'s chief says.
However, the decline in savings growth rate, which could lead to a dearth of savings for investment, is not a big concern as the savings-to-gross domestic product (GDP) ratio remains higher than investment-to-GDP ratio, GSB's president Chatchai Payuhanaveechai said.
Gross savings are growing at 11% per annum, down from 16% annually during 2009-10, he said, without providing the latest figures.
The country's savings-to-GDP ratio at 33% still surpasses the investment-to-GDP proportion.
According to Kasikorn Research Centre's notes on financial liquidity of commercial banks for September, deposits at commercial banks grew at a slower pace of 1.15% over the same period last year to 11.2 trillion baht. Commercial banks' financial liquidity in September tightened the most since the end of 2007, as seen by the fact that loan-to-deposit plus borrowing ratio increased to 92.1% from 90.8% in August.
For savings at GSB, Mr Chatchai said the total deposits amounted to 2 trillion baht at the end of September, with 27 million deposit accounts and 20 million holders.
He forecast that the bank's total deposits will rise by 1.5-2% at the end of this year.
To meet demand in search for yield, the state-backed savings bank launched special savings certificates at face value of 100 baht with a five-year maturity. The savings certificate will give returns of five baht per unit of certificate.
He said the bank estimates it will raise 50 billion baht from the new special savings certificate.
The GSB also offered piggy banks produced to celebrate both His Majesty King Bhumibol Adulyadej's 70th anniversary of accession to the throne, as well as National Savings Day for depositors who park at least 200 baht at the bank's branches.
The bank's loans outstanding at the end of September totalled 1.85 trillion baht.
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