State Bank of India, the country's largest lender, has hiked its deposit interest rate by 0.25 per cent (25 basis points or BPS) to 9 per cent for three to five year tenor for deposits of less than Rs15 lakh. The increase is effective 1 July the bank said in a statement.
Earlier this month, the state-run lender had reduced its retail term deposit rates by similar 25 BPS for tenures up to 240 days. Those schemes now offer interest rates of 7-7.25 per cent, down from 7.25-7.50 per cent prior to the rate cut.
On Friday, HDFC Bank had reduced base rates by 20 basis points to 9.80 per cent, effective 30 June. The country's second largest private sector lender's benchmark prime lending rate too decreased to 18.30 per cent.
After the Reserve Bank of India (RBI) slashed the key policy rate by 50 bps in its April annual monetary policy, the lender tweaked key rates for the first time.