HDFC Bank, the country’s largest private lender by assets, revised interest rates on deposits of under `1 crore, raising the rate on one-year fixed deposits (FDs) by 10 basis points (bps) to 6.85%. While rates on deposits with shorter maturities were left unchanged, FDs with longer maturities saw even larger hikes in some buckets. The rate on deposits in the maturity bucket of one year and 17 days to two years was raised by 75 bps to 7%, while that on deposits maturing between two years and five years was hiked by 100 bps to 7%. Retail deposits maturing between five years and 10 years will continue to yield 6%.
The one bucket which saw a rate cut was that of deposits maturing between a year and one year and three days, where the rate was reduced by 25 bps to 6.5%.
In February, State Bank of India (SBI) had raised interest rates on retail deposits, signalling a decisive turn in the rate cycle. It followed up the move days later with a hike in lending rates, accompanied by ICICI Bank and Punjab National Bank (PNB).
Recently, HDFC Bank acknowledged that in FY18, it has seen relatively slow growth in deposits. Paresh Sukthankar, deputy managing director at the bank, told analysts after its March quarter results that deposit growth had lagged loan growth in the September and December quarters.
“So, we did want to step on the accelerator a little in terms of getting more deposits flow in, which is what we have done,” he said, adding, “from our perspective, we still continue to look at pacing both our loan and deposit growth on an annualised basis at somewhat similar growth rates. And, of course, we try and maintain a healthy mix of those deposits as we get them.”
Total deposits at HDFC Bank stood at `7.89 lakh crore, as on March 31, 2018, up 22.5% over March 31, 2017.