ICICI, HDFC Bank cut fixed deposit rates by 0.15-0.25%

ICICI bank will pay 7.1% interest rate for FD between 390 days to 2 years, while HDFC Bank will has lowered interest rate to 6.75% for one-year FD


The lowering in FD rates by major banks may herald reduction in lending rate as well in the next few days. Photo: Pradeep Gaur/Mint
The lowering in FD rates by major banks may herald reduction in lending rate as well in the next few days. Photo: Pradeep Gaur/Mint

New Delhi: Faced with liquidity comfort, major lenders, including ICICI Bank Ltd and HDFC Bank Ltd, on Thursday lowered fixed deposit (FD) rates by up to 0.25% in view of surge in deposits following the demonetization.

The lowering in FD rates may herald reduction in lending rate as well in the next few days.

For FD between 390 days to 2 years, the bank has lowered the interest rate by 0.15% effective from Wednesday, ICICI Bank website showed. ICICI Bank will pay 7.10% as against 7.25% earlier.

Meanwhile, HDFC Bank has reduced interest rate by 0.25% across all tenures on bulk deposits ranging between Rs1-5 crore. The new rates are effective today, as per HDFC Bank website.

With the revised interest rates, the one-year FD will attract an interest rate of 6.75% as against the 7% earlier. For fixed deposits between ‘3 years 1 day-5 years’, the rate has been lowered to 6.5% from 6.75%.

On Wednesday, the country’s largest lender State Bank of India (SBI) slashed FD rates on select maturities by up to 0.15%. Private lender Axis Bank has cut marginal cost of fund-based lending rate (MCLR) by 0.15-0.2%.

Till Wednesday, SBI collected Rs1,14,139 crore in deposits over the last seven days after the government announced to scrap Rs500 and Rs1,000 notes. According to estimates, banks have collected cash deposit of over Rs lakh crore following the demonetization decision announced on 8 November by Prime Minister Narendra Modi. PTI

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