HDFC Bank : Slashes Rates on Bulk Deposit over Rs. 5 crore by 1.25% to 5% - MYREALITY.In, Real Estate, Share Market, Mutual Fund, Insurance
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Sunday, January 08, 2017

HDFC Bank : Slashes Rates on Bulk Deposit over Rs. 5 crore by 1.25% to 5%

HDFC Bank : Slashes Rates on Bulk Deposit over Rs. 5 crore by 1.25% to 5%

HDFC Bank slashed interest rates on deposits of over Rs. 5 crore with maturities of one year and more by 125 basis points (bps) to 5%, effective from Jan. 7, 2017 (Friday.)

With the latest cut, the differential between the bank’s bulk deposit rate on one-year money and that of State Bank of India has narrowed to 0.75% (75 bps) from 2% (200 bps).
Amid a surge in deposits resulting from the withdrawal of Rs. 500 and Rs. 1,000 currency notes, a number of banks have reduced rates on term deposits.
According to the Reserve Bank of India (RBI), banks had garnered deposits to the tune of Rs. 12.44 lakh crore between 2016 November 10 and 2016 December 10.

However, during the fortnight ended 2016 December 23, deposits showed a decline for the first time since demonetisation.
Aggregate deposits with the banking system fell 0.7% from the fortnight ended December to Rs. 105.16 lakh crore.

On Jan. 6 2017, Canara Bank had cut rates on one-year deposits of over Rs. 1 crore by 1.5% (150 bps) to 4.85% and on two- and three-year deposits by 1.65% to 4.9%. The bank has also lowered rates on deposits of less than Rs.1 crore with maturities of two and three years by 0.35% to 6.9%.
Last month, state-owned lenders Dena Bank and Syndicate Bank had reduced interest rates on some fixed deposits to lower than the comparable rates offered by State Bank of India.
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Dena Bank now pays 4% on one-year deposits of between Rs. 1 crore and Rs. 5 crore, as against SBI’s 4.25%. Earlier, Dena Bank used to pay 5% interest on such deposits.

Syndicate Bank slashed rates on retail term deposits of maturities between one year and three years by 0.25%-0.5%, effective December 19, 2016. The rates of interest on one-, two- and three-year deposits with the bank now stand at 6.8%, 6.5%, and 6.5%, respectively. The comparable rates for SBI are 6.9%, 6.85% and 6.5%.

Banks had started cutting deposit rates even before the government’s demonetisation announcement in the wake of the RBI’s 0.25% cut in the repo rate at its October 5, 2016 monetary policy review. The withdrawal of high-currency notes has resulted in a further drop in the cost of funds with the banking sector.


HDFC Bank : Slashes Rates on Bulk Deposit over Rs. 5 crore by 1.25% to 5% Reviewed by S Chitra on January 08, 2017 Rating: 5 HDFC Bank : Slashes Rates on Bulk Deposit over Rs. 5 crore by 1.25% to 5% HDFC Bank slashed interest rates on deposits of over Rs. 5 cro...

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