Croatia's household deposits reached 263.4 billion kuna at the end of August 2022, increasing by 22.3 billion kuna or 9.4% from August 2021, the Croatian Central Bank HNB) told the Croatian staten news agency Hina on the occasion of World Savings Day, marked on 31 October.

Household deposits represent the single largest component of banks’ financial assets, which totalled 601 billion kuna at the end of the second quarter of this year.

The increase was due to growing deposits in the national currency kuna as well as foreign currency deposits, while kuna savings and time deposits were decreasing, the central bank said.

Over the past year there has been an increased contribution from foreign currency deposits to the growth of total deposits as a result of the recovery of the tourist industry after the COVID-19 pandemic and the process of accession to the euro area.

Croatian citizens have been increasingly depositing their cash in banks so that it can be automatically converted into euro on 1 January 2023 when the country joins the European Union’s single currency area.

At the end of August this year, 33.3 billion kuna in cash was in circulation, which was 5 billion kuna or 13% less than at the same time last year, and this decrease is expected to continue. The HNB said that in some countries that had switched to the euro before the amount of cash in national currency in circulation nearly halved in the year leading up to the euro changeover, with this process intensifying in the months before the adoption date.

As for other forms of household financial assets, the second most prevalent form was shares in pension funds, which reached 139 billion kuna or 23% of total financial assets in the first half of 2022, increasing by 8.3 billion kuna or 6.4% from the first half of 2021. Most of these assets were held by mandatory pension funds.

Ownership interests in non-financial companies totalled 104 billion kuna in the first half of the year, accounting for 17% of total household assets. Deposits with insurance companies reached 25 billion kuna, or 4% of household assets, and shares in investment funds amounted to 14 billion kuna, or 2% of total household assets, the HNB said.

(€1 = 7.53 kuna)