Deposits or bonds?
02/06/2011 16:00
The Washington Agreement Must Be Reactivated! 06/01 19:04
An individual who has savings apart can invest them in several ways. If he has
no business activities, the best way according to experts is investing
them in the financial system or as deposits in banks or governmental
bonds. But which is the most lucrative alternative? Official Data from
Bank of Albania show that bank interests for deposits have
decreased during the year. According to this data, the average interest
rate in April for a one year term deposits was 5.9%.
Compared to last year’s April, interests for one year term deposits have decreased with 0.7 percentage points. These data show that interests have decreased for deposits of all maturation periods, even for those that have more than one year. But while deposit interests have decreased, the interest of bonds has a growing tendency.
The current interest for treasury bonds with a one year term of maturation is 7.4% or 1.5% more than one year term deposits. This means that for an individual who saves 1 million ALL, if he will invest his savings in a bank account, he will benefit an interest of 59,000 ALL. But if he would invest the same amount of money in treasury bonds, he would profit from the interests a total of 74,000 ALL ore 15,000 ALL more.
Treasury bonds are turning again into a more lucrative investment alternative than bank deposits, because the interest rates gap between these saving means has favored treasury bills.
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