ICU Research: Liquidity stabilizing

January 13, 2017 - Cbonds

 

Through yesterday morning, banking sector liquidity stabilized as it declined a slight UAH0.12bn to UAH108.10bn while funds reallocated from CDs to banks' accounts at a less significant volume than on Tuesday. Following Wednesday's cashflows, banks' correspondent accounts with the NBU increased UAH2.38bn to UAH41.92bn while total CDs outstanding fell by a nearly equal amount of UAH2.50bn to UAH56.18bn yesterday. Fund outflows to the NBU was similar to the decline in liquidity as the NBU issued UAH0.50bn of 14-day loans, mostly refinancing UAH0.59bn of mature loans UAH0.59bn that were due that day.

Investment implications: The negative impact of Treasury operations has declined twice since the beginning of this week. If this continues, liquidity should stabilize, but just till the end of next week when month-end tax payments begin.
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