FDs maturing between one year and 14 months will yield 7.1%, 35 basis points higher than earlier.
FDs maturing between one year and 14 months will also yield 7.1%, 35 basis points (bps) higher than earlier. All deposits of under Rs 1 crore with longer maturities will earn 7%. The 14 months to 17 months bucket was earlier priced at 6.75%, while all maturities ranging between 17 months and 10 years earlier yielded 6.9%.
Rates on deposits with maturities of less than a year have been left unchanged.
Last month, HDFC Bank, the country’s largest private lender by assets, hiked retail deposit rates by up to 100 bps.
Banks have taken to raising deposit rates in recent months, amid competition from mutual funds and hardening bond yields. Since November 2017, the base effect of demonetisation has also begun to kick in, leading to deposit growth hitting multi-year lows. Between November 2017 and March 2018, deposits have grown by 3-7% on a fortnightly basis, according to data released by Reserve Bank of India (RBI).
Earlier this year, Axis Bank had also raised the savings rate in some categories. Chief financial officer Jairam Sridharan told analysts that the bank is taking an aggressive approach in acquiring savings accounts. “There is a particular segment in which this (savings rate hike) is not a defence thing, it is playing offence,” he said, adding, “This is one segment in which we were seeing and are seeing some opportunities and hence, the move.”