India's largest public sector lender State Bank of India (SBI) has cut interest rates of three retail term deposits below Rs 1 crore by 25 basis points with effect from December 8.
Term deposits for 1-3 years and 3-5 years has been lowered to 8.5 percent from existing 8.75 percent, while for 5 years and above it has been reduced to 8.25 percent from current 8.50 percent. The above rates will also be applicable to NRE deposits for tenors of one year and above.
This is the second time that SBI has chosen to cut deposit rates in the past 8-10 weeks.
However, the bank is not sure if it will at all lower lending rates anytime soon.
VG Kannan, MD, SBI, says: "The liquidity is quite adequate in the system and therefore we felt that paying higher interest doesn't make sense and many of the large high value corporates have been accessing the market at much lower rate."
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Updated Date: Feb 03, 2017 00:20:29 IST