SBI ups NRE Rupee deposit rates by 25 bps

SBI raised interest rates on NRE rupee term deposits for tenors three years and less than five years from 8.75% to 9, on deposits under Rs15 lakh category

Mumbai: In its bid to meet the 25% deposit growth target, the country’s largest lender State Bank of India (SBI) has revised its pricing on NRE rupee deposits on select maturities and baskets by 0.25% at 9%, reports PTI.

 

"State Bank has decided to raise the rate of interest on NRE rupee term deposits for tenors three years and less than five years from 8.75% to 9, on deposits under Rs15 lakh category with effect from yesterday," the bank said.

 

Last month, SBI Managing Director and Group Executive for National Banking A Krishna Kumar had said that the bank was targeting growth of 25% in deposits and 22% in advances in the current fiscal.

 

"As of March end, we have roughly grown about 18% in deposits and 15-16% in credit," Kumar said.

 

According to the latest RBI data, deposits, mainly fixed deposits, rose 1.9% to Rs3.3 lakh crore in April-June period, against Rs2.8 lakh crore in the year-ago period.

 

Thanks to the liberalisation in interest rates, non-resident Indian (NRI) deposits have become attractive.

 

In the April-June period, the credit off-take was more or less on par with the year-ago period.

 

With deposit accretion outpacing credit growth, the collective incremental credit-deposit ratio of banks has gone down to 46% from 52% in the year-ago period.

 

In the domestic context, a CD ratio of 70% is considered ideal.

 

The RBI has set deposit growth guidance of 14 to 15% this fiscal and a credit growth at 17 percent. Banks' incremental credit-deposit ratio, which reflects fresh demand for loans in proportion to deposits, stood at just 48% compared to 51% in the same period last year and 84% in FY11.

 

Banks' outstanding deposits as of June end stood at Rs62.3 lakh crore, while credit stood at Rs47.6 lakh crore.

Comments
Array
Free Helpline
Legal Credit
Feedback