The new rates ranging from 5 to 10 bps will apply to retail deposits below Rs 1 crore with immediate effect, the bank said on its website.
State Bank of India (SBI) has hiked fixed deposit rates by up to 10 basis points, or 0.10%, to 6.80% on select maturities. The new rates ranging from 5 to 10 bps will apply to retail deposits below Rs 1 crore with immediate effect, the bank said on its website. SBI hiked rates with a maturity period between one year and less than two years to 6.80% from 6.70%, a 10 bps hike, and for the period ranging between two years to less than three years, the bank raised rates by 5 bps to 6.80% from 6.75%. Deposit rates for other tenures ranging from 7 days to 10 years remain unchanged.
Similarly, term deposits for senior citizens have been hiked by 10 bps to 7.30% for one to less than two years and a hike of 5 bps to 7.30% for two to less than three years. The move follows rate hikes by two biggest private sector banks – ICICI Bank and HDFC Bank – earlier this month. HDFC Bank hiked its retail fixed deposit rates up to 50 bps, while ICICI Bank had raised the rates up to 25 bps.
Lending rates have trended up over the last four or five months. The MCLR saw an upward movement over the past 4-5 months leading to a hike in the lending and deposit rates, data from RBI showed. With the RBI expected to maintain the repo rate in its next monetary policy meeting, the banks hiking deposit rates would boost lending capacity of banks to fulfil the growing credit need and meet liquidity constraints.
“We maintain our call that the RBI is unlikely to change the REPO rate,” said experts at Kotak Mahindra Bank. PSU banks saw approximate 15 bps rise in weighted average lending rates month-on-month on fresh loans to 9.5% whereas it was flat m-o-m for private banks in September.