SBI Hikes Fixed Deposit Rates by up to 75 Basis Points; Hear Are The New Rates

The State Bank of India (SBI), the largest lender in the country, has reportedly raised its fixed deposit rates on certain short-term maturities by up to 75 basis points. 

The rate for deposits ranging from 46 to 179 days has been increased to 5.50 per cent, up from the previous 4.75 per cent.

There has been a 25 basis point increase in the other two maturity buckets, that is 180-210 days and 211 days to less than 1 year, to 6 per cent and 6.25 per cent respectively.

The new rates on deposit less than Rs 2 crore are effective from May 15, 2024.

Senior citizens would be eligible for additional 50 basis points on the revised rates as per the norms, it said.

SBI has left interest rates unchanged on other maturity buckets beyond one year.

For fixed deposits above Rs 2 crore, the bank has increased interest rates on both short-term and long-term maturity.

For three maturity periods starting from 7 days till 210 days, the interest rate has been raised between 10 basis points and 25 basis points.

At the same time, longer duration term deposits starting one year till three years, will attract higher interest rates between 20 basis points and 25 basis points.

This comes at a time when banks are witnessing increased LDR ratio (Loan-to-deposit ratio) alongside stiff competition for maintaining their deposit levels. 

A report released earlier this year by S&P Global Ratings stated the RBI's increased regulatory radar over banks will improve the governance levels of these institutions and put a limit on aggressive lending. 

But this might also lead to higher capital costs for banks and an eventual slowdown in loan growth.

(With Inputs From PTI)