The crisis is clearly beginning to deplete the financial potential of citizens with lower wages, and more and more of them seem to be reaching out to their savings in banks to meet their daily payments.
Such an impression is created by the BNB data for the first half of 2021. They show that on a quarterly basis, both in numbers and in total amounts, deposits from all groups have started to decrease below BGN 10,000. There are groups up to BGN 1,000, between BGN 1,000 and 2,500, between BGN 2,500 and 5,000 and from BGN 5,000 to 10,000. The last two groups joined this negative list in the second quarter of 2021.
At the moment, it is not possible to say whether this decline is due to the impoverishment of these savers or an increase in their costs due to the opening of the economy. But if in the next two quarters this trend continues, or deepens with the attraction of deposits from higher groups to the negative list, this will be an indicator of a steadily expanding income crisis. This will be a problem, as the groups listed so far include over 8 million accounts (87% of all accounts covered by these statistics), which store over BGN 11 billion.
Here the biggest drop in deposits in the group is between BGN 1,000 and 2,500. It concentrates over 1 million savings, the total amount of which is BGN 1.68 billion. For the second quarter of 2021, compared to the end of March, this group shrank by 3.7%, and the total amount – by 3.6 percent.
Bank deposits of wealthy citizens are also declining. We are talking about savings over BGN 500,000 per account. Moreover, here we can already talk about a trend, because this process (with some fluctuations) is observed for the second consecutive quarter. In the first quarter the deposits of households with between BGN 500 thousand and 1 million shrank by 2% as a number and by 1.6% as a total amount of funds, and in the second quarter, compared to the first, these reductions were respectively 0.9% and 0.3 percent.
Thus, at the end of June 2021, this group includes 2,045 deposits, the total amount of which is about BGN 1.41 billion.
The situation is almost the same with deposits over BGN 1 million. There in the first quarter there was a decrease in the number of deposits by 2.2%, but the total amount on them increased by 4.6%, and here we can talk about concentration. However, in the second quarter, compared to March 2021, there was a decrease in the number of deposits by 0.3% and the amount on them – by 3.8 percent. Thus, at the end of June in the group of bank savings over BGN 1 million of households there were 1,150 accounts with a total amount of BGN 3.05 billion. The reasons for the negative trend in these two groups may be different. On the one hand, people with a lot of money may have decided to direct some of their savings to investments that are more profitable than bank deposits and accounts. But it is noteworthy that the negative trend begins in early 2021 with the start of political instability in our country. Therefore, it is possible that richer citizens will simply withdraw some of their money from our country and direct it to quieter destinations.
However, middle-class people continue to increase their bank deposits. And the higher the group in terms of the amount of deposits, the greater the increase. The slowest-growing deposits grow the slowest – those with BGN 10,000 to BGN 20,000. At the end of June they were 640.6 thousand and a total of BGN 8.94 billion was collected in them. Compared to March 2021, they increased by 0.7% in number and by 0.9% in total. Compared to June 2020, these growths are 8.1% and 8.4%, respectively. This group of deposits is important because it is one of the largest in this segment, as it concentrates nearly 14% of the total savings of households in the banking sector, which is nearly BGN 63.9 billion.
The other two important groups are those of deposits between BGN 50,000 and 100,000 and between BGN 100,000 and 200,000. They store a total of over BGN 20 billion, distributed in over 226.5 thousand household accounts. The reported growth for the second quarter is between 2.7% and 3.4% for the number of accounts in the individual groups and between 2.4% and 3.1% for the total amount in both groups.
The number of deposits and the total amount of them in the group with savings between BGN 200,000 and 500,000 is increasing the fastest. It has nearly 15,000 deposits in which BGN 4.23 billion are concentrated. In this group on a quarterly basis the number of accounts grew by 6.1%, and the total amount on them – by 7.2 percent.
Finally, it is important to clarify that all these statistics include the money not only of citizens, but also of sole proprietors such as sole traders, as well as non-profit organizations serving households.
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