State Bank of India steeply hikes deposit rates for various tenure

The latest pricing revision comes after three consecutive revisions in the rates by the lender on bulk term-deposits in the past three months.

State Bank of India steeply hikes deposit rates for various tenure

Mumbai: Signalling a hardening interest rate regime across the banking system, State Bank of India, the leader in both the credit as well as deposit markets, steeply increased the bulk deposits rates for various maturities by up to 0.75 percent with immediate effect.

The latest pricing revision comes after three consecutive revisions in the rates by the lender on bulk term-deposits in the past three months.

Under the present loan pricing mechanism that is based on the marginal cost of funds-based lending rates (MCLR), any upward revision in the cost of funds, including deposits pricing automatically leads to a pricing revision in loans.

For retail deposits, below Rs 1 crore, rates have been increased by up to 0.50 percent, while for deposits maturing in one year to less than two years, the pricing has been raised by 0.15 percent to 6.40 percent from 6.25 percent earlier.

All the new rates come into force immediately, the bank said in a statement.

It can be noted that many banks have been increasing their deposit and lending rates since the last quarter.

While lending rates have been jacked up on an average of 5-10 bps by private sector lenders like HDFC Bank, Axis Bank, Kotak Mahindra Bank and Yes Bank since January, almost all the state-run lenders have been increasing their bulk deposit rates in the range of 15 bps to 125 bps.

SBI today revised upwards the retail deposit rates for the two years to under 10 years bracket by 0.50 percent to 6.50 percent. The existing rate is 6 percent at SBI.

It can be noted that the lender has in the past three months also revised upwards its bulk term deposit pricing in as many months.

For Rs 1 crore to Rs 10 crore bulk deposits, maturing in one year to less than two years, the bank had raised rates by 0.50 percent from 6.25 percent to 6.75 percent.

For the deposits in the two to less than three years maturity, the rates have been increased by 0.75 percent to 6.75 percent.

For above Rs 10 crore bulk deposits maturing between one year and less than two years, the rates have been raised by 0.50 percent to 6.75 percent.

Rates for bulk deposits maturing between two to less than three years is increased by 0.75 percent to 6.75 percent.

By continuing to use the site, you agree to the use of cookies. You can find out more by clicking this link

Close