Mumbai, Feb 28 (PTI) 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, today steeply increased the bulk deposits rates for various maturities by up to 0.75 per cent with immediate effect. Also Read - Have You Faced ATM Transaction Failure Due to Insufficient Balance? Here’s What You Need to do
Today’s pricing revision comes after three consecutive revisions in the rates by the lender on bulk term-deposits in the past three months. Also Read - Working on War Footing to Resolve Matter: HDFC Bank Tells Customers After RBI Order on Service Outage
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. Also Read - RBI Asks HDFC to Stop Selling New Credit Cards & Halt Digital Activities After Outages
For retail deposits, below Rs 1 crore, rates have been increased by up to 0.50 per cent, while for deposits maturing in one year to less than two years, the pricing has been raised by 0.15 per cent to 6.40 per cent from 6.25 per cent 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 per cent to 6.50 per cent. The existing rate is 6 per cent 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 per cent from 6.25 per cent to 6.75 per cent.
For the deposits in the two to less than three years maturity, the rates have been increased by 0.75 per cent to 6.75 per cent.
For above Rs 10 crore bulk deposits maturing between one year and less than two years, the rates have been raised by 0.50 per cent to 6.75 per cent.
Rates for bulk deposits maturing between two to less than three years is increased by 0.75 per cent to 6.75 per cent.
This is published unedited from the PTI feed.