Russian consumers have become an increasingly significant customer group for Finnish banks, with households surpassing Russian businesses in terms of their level of savings.
In Lappeenranta, southeast Finland, St. Petersburg resident Vasily Fissevh has been a customer of Finnish banks for six years.
“Finnish banks are reliable, European banks. The bank cards are easy to use for shopping abroad,” Fissevh said.
Other customers from the east are also increasingly interested in reliability. Finnish banks currently hold close to 1.7 billion euros in funds from Russia, roughly 1.5 billion of it coming from Russian banks.
According to data from the Bank of Finland, currently Russian householders have deposited some 135 million euros into their Finnish bank accounts, compared to the 77 million held by Russian businesses.
“If we look at foreign savings in Finnish banks, that’s a large sum,” said Bank of Finland Senior Economist Seija Lainela.
The Bank gathered information on households savings based on nationality, without drilling down into specific amounts held by individual households.
Real estate, jobs and study
Savings by Swedish households however exceed that of the Russians, and this is partly explained by the operations of the Nordic bank Nordea in both Sweden and Finland. However the Russians are far behind. Close and regular relations with the eastern neighbour are especially apparent in border banks such as Osuuspankki in southern Karelia.
“When Russians come to Finland to study or work, they generally need banking services. These customers visit us weekly,” explained Jari Himanen, head of Osuuspankki’s southern Karelia branch.
“Russian families also purchase holiday homes, residences for vacation use or housing company or vacation home shares. They need a Finnish bank account to handle these kinds of investments,” Himanen added.
As a tribute to the close relationship with the east, Osuuspankki has some 800 Russian customers in southern Karelia. The bankers say customers always save as they go.
“In south Karelia that’s about 3,000 euros per account,” Himanen outlined.
Improved deposit protection in Russia
The numbers show however, that Russian bank savings have remained constant at around 135 million euros in recent years. While this speaks to the stability of the Russian banking sector, there is still a shadow of uncertainty.
“The Russian Central Bank has done a great deal of work to supervise and reform the banking sector,” Lainela observed.
“In practice Russia has a functional deposit guarantee system, which has responded to claims in a very flexible manner. Even last autumn some banks closed their doors or officially ended operations. Depositors no longer fear that they won’t get their money back,” she added.
“All the same many times in the past 20 years Russian householders have lost their money in different banking crises and with the devaluation of the ruble, so there is no doubt some residual skepticism over how these banks operate,” she concluded.
