ICICI, HDFC Bank Cut Bulk Deposit Rates By Up to 0.25 Per cent

Leading private sector lenders ICICI Bank and HDFC Bank have cut rates by up to 0.25% on high value fixed deposit on select maturities, a move that could be a precursor to lower lending rates.

The rates have been revised downwards for deposits over Rs 1 crore by 0.25% by ICICI Bank effective today, sources said.

Fixed deposit rate of maturity between 121-150 days has been revised downward to 8% from 8.25% earlier.

ICICI, HDFC Bank Cut Bulk Deposit Rates By Up to 0.25%

Term deposit of the country's largest private lender between 61-90 days for high value fixed deposit over Rs 5 crore and above has been lowered to 8% from 8.25%.

Similarly, for term deposit between 91-120 days would attract lower interest rate of 8%.

The second largest private sector lender, HDFC Bank too lowered its on fixed deposits of over Rs 5 crore and above effective yesterday.

Earlier this month, Axis Bank reduced fixed deposit rates by up to 0.25% across various maturities.

Axis Bank was one of the first major lenders to slash its deposit offering after RBI's repo cut on March 4.

The third largest private sector lender has cut its deposit rate offerings by 0.25% across buckets in the 18 to 36 months window, Axis Bank official said.

Similarly, for deposits up to 18 months, the rates have been decreased by 0.15% to 8.50%.

With easing liquidity conditions and the low credit offtake, Axis Bank was among the few which cut its base rate or the minimum rate of lending in October last year by 0.10%.

It can be noted that the RBI indicated a shift in its stance after getting a grip over inflation and delivered a surprising 0.25% cut in January, and followed it up with a similar move on March 4, indicating its comfort with the budget announcements.

Following these moves, the repo rate at which the central bank lends to the system, currently stands at 7.75%.

While banks claim the policy moves generally take time to get transmitted into actual lending rates, the RBI has been unhappy with the banks for not passing the benefits of the rate cuts to the borrowers.

The country's largest lender, State Bank of India, has indicated that it would be very difficult to have a cut in lending rates till the end of March, which is generally the busy season for credit offtake.

PTI

Read more about: icici, hdfc bank, interest rates, rbi
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