SBI lowered deposit rates by 50-75 bps

SBI has announced a sharp reduction in fixed deposit rates. The cut will translate into lower lending rates in the coming weeks as the benchmark for loans is calculated based on the cost of funds. The reduction, which is in the range of 50-75 basis points (100bps = 1 percentage point), has been attributed to the “falling interest rate scenario and surplus liquidity”. Rates have been revised for both retail, as well as bulk deposits of above Rs 2 crore, and will come into effect from August 1.

For time deposits with longer tenors, there is a reduction of up to 20bps in the retail segment and 35bps in the bulk segment. Interest rates have been slashed by 50-75bps for time deposits with shorter tenors of up to six months. SBI officials said that the bank was comfortable in terms of liquidity and was raising enough to meet credit demand.