Investments of individuals in bonds and bonds fell again in the first quarter of 2024

2024-05-13 10:06:44, Ekonomi CNA

Investments of individuals in bonds and bonds fell again in the first quarter of

Individuals' investments in bonds and bonds of the Albanian government fell in the first quarter of this year.

The data of the Financial Supervision Authority (FSA) show that the purchases of individuals in the primary market of bonds and bonds decreased to ALL 12.1 billion, down by 19.8% compared to a year ago.

The decrease was even higher expressed in the number of transactions, which decreased to 4409, 25.2% less compared to the first quarter of last year.

According to the type of financial instruments, the biggest decline was recorded in the bond market.

AMF figures show that the value of bond purchases in the primary market decreased to less than ALL 2.5 billion, down 31.1% compared to the same period last year. Meanwhile, investment in treasury bonds fell to ALL 9.65 billion, 16.3% less compared to the first quarter of 2023.

Investment in short-term instruments remains dominant among individuals, with almost 80% of the total value invested during the period.

The above data refer to transactions carried out through financial intermediaries licensed by the AMF, mainly commercial banks. Investing in treasury bonds can also be done through special counters of the Bank of Albania.

Investments of individuals in bonds and bonds fell again in the first quarter of

The downward trend of individuals' investments in bonds and bonds started last year. According to the AMF, for 2023 the purchases of individuals in the primary market of bonds and bonds fell to ALL 37.5 billion, down 24.5% compared to 2022.

The fading interest of individuals to invest in bonds and bonds seems to be related to the downward trend of the yields of these instruments. In 2022, the strong growth of bond and bond yields brought increased interest from individuals to invest in these instruments. Some of the depositors even preferred to withdraw the money held in bank deposits or investment funds and invest in bonds and bonds, in search of higher returns.

Meanwhile, last year the rate of increase in interest rates by the Bank of Albania slowed down significantly. This caused the government bond market to calm down and yields fell significantly in the first half of 2023, which stabilized further during the second half and first quarter of this year.

According to the commission companies, the market of individuals' participation in the auctions of government securities continues to be dominated by Raiffeisen Bank, with almost 58% of the total amount invested by individuals, followed by the National Commercial Bank with 19% of the total. Currently, ten licensed financial institutions operate for this service, of which nine are commercial banks./ Monitor.al