CIMB Thai Bank has seen what it terms "preferred" customers - those with deposits of Bt1 million or more - increasing their exposure to long-term fixed deposits of at least 12 months, senior executive vice president Adisorn Sermchaiwong said yesterday.
In the deposit market, 60-70 per cent of the capital invested is currently in short-term fixed deposits, but the proportion accounted for by long-term deposits is likely to increase because of the migration of money among wealthy depositors, he said.
The ongoing political tension means it is not a good time for these customers, many of whom are entrepreneurs, to allocate money for business investment, especially given that it is impossible to say when the political situation will return to something resembling normalcy, he added.
Interest rates for long-term fixed deposits are not much different from those for short-term deposits, but CIMB Thai’s wealthy customers still prefer to invest in the former to lock in a return as they expect the central bank’s benchmark rate to be trimmed at the Monetary Policy Committee’s next meeting, Adisorn said.
An eight-month fixed deposit at CIMB Thai pays 2.88 per cent per annum, and the bank plans to launch a 12-month time deposit next month – offering 3 per cent – to meet the current investment trend. Net deposits at the bank so far this year are in the region of Bt5 billion to Bt6 billion, the executive said, adding that Bt4 billion of this amount has been lodged in eight-month time accounts.
Moreover, half of the new deposits came from juristic persons, as opposed to individuals.
Deposit growth in the first two months of the year was below the bank’s target, he said.