New Delhi, July 31 (PTI) Shares of State Bank of India Also Read - New Delhi, Goa and Mumbai Top Booked Destinations by Indians During Valentine’s Week

went up by nearly 5 per cent today after it slashed interest Also Read - Mughal Gardens to Open For Public From THIS Date, Entry Through Online Booking Only | Check Timing, Other Details

on savings account deposits by 50 basis points to 3.5 per cent Also Read - Costliest 'Ghagra'? Drugs Worth Rs 1.7 Crore Hidden in Lehengas That Were Being Sent to Australia

on balance of up to Rs 1 crore.

The SBI stock rallied 4.71 per cent to Rs 313.30 on BSE.

On NSE, it gained 4.74 per cent to Rs 313.30.

However, the bank will continue to offer 4 per cent

interest on savings account balance of Rs 1 crore and above.

“The bank is introducing two-tier saving bank interest

rate with effect from July 31. While balance above Rs 1 crore

will continue to earn interest at 4 per cent per annum,

interest at 3.5 per cent will be offered on balance of Rs 1

crore and below,” SBI said in a regulatory filing.

It further said: “The decline in rate of inflation and

high real interest rates are primary considerations warranting

a revision in rates of interest on savings bank deposits.”

“The rate cut by SBI on savings bank account is a

strategic move by the bank aimed at increasing profits. This

is purely a commercial move which will boost profitability and

ratios for the bank,” said Jimeet Modi, CEO, SAMCO Securities.

Buying was also seen in other bank stocks, with Bank of

Baroda trading 3.25 per cent higher, ICICI Bank up 2.60 per

cent and PNB (1.92 per cent).

The BSE bank index was trading 1.37 per cent higher at

28,405.09 during the late afternoon trade.

This is published unedited from the PTI feed.