Lending major, the State Bank of India has reduced the deposit rates on all maturities by 25 basis points.
Following the pre-budget meeting, held in the second week of this month, between the Union Finance Minister, Pranab Mukherjee and chiefs of public sector banks, O.P. Bhatt, chairperson, State Bank of India, had made a statement hinting at the rate cuts -"Our bank will decide on lowering the interest rates by this month-end," he said.
With the new deposit rates in effect, the bank will offer a rate of 7.5 percent on its special 1,000-day deposit scheme and a rate of 8 percent on the 8-10 year term deposits.
The rate on deposits with maturity between 15 to 45 days is 3 per cent, 4 percent for deposits between 46 to 90 days, 5.25 per cent for 91 to 180 days and 6.25 percent on deposits with maturity between 181 days to one year.
For deposits between one to two years, the deposits rate is 7 per cent and for deposits with maturity up to two years and less than 1,000 days, the rate is 7.25 percent.
Before this, the bank reduced its deposits rate by 50 basis points in last month. The rates are now comparative with the current industry rates for the deposits products.
The bank has however not reduced the prime lending rates for its borrowers, which continues to be 12.25 percent.