Albanians’ savings increased by 60% in last seven years at ALL 1,147bln

Albanians own about ALL 1.15 trillion in the form of savings invested in financial instruments.

According to data from the Bank of Albania, individuals’ savings increased further in 2017.

Compared to 2016, households’ financial assets grew by about ALL 20 billion.

While compared to 2010, household savings in Albania have increased by nearly 60%.

The growth has been particularly sensitive until 2013, while after this year the savings have continued their growing trend, but at lower rates.

On the one hand, the saving trend is understandable in the conditions of a downturn cycle of the economy and the increase in insecurity among individuals.

But on the other hand, the increase in formalized savings by 60% during a relative crisis period is an impressive statistic.

Overwhelmingly, the savings of Albanians are invested in bank deposits.

By the end of 2017, households had deposits in ALL and foreign currency at ALL 937 billion or around 82% of total savings invested in the financial system.

The rest is invested in Albanian government debt securities, investment funds and private pension funds.

Last year there was an increase in investment in bonds, which guarantee higher returns due to longer maturities.

The increase in savings would have resulted even higher if we consider the exchange rate effect.

Most of the bank deposits and a significant part of the contribution to the investment funds are in euro, therefore the value given in ALL for reporting purposes is partly affected by the depreciation of the European currency.

Albania has a sharply higher national savings ratio compared to other countries in the region.

This has helped to reduce the dependence of the banking system from external funding sources and is an important leverage to enable financing of new investments for financial intermediation.

The presence of large amounts of savings from individuals simultaneously creates significant potential to further develop the financial market and diversify the means of investment of these savings.

SCAN

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