Bank of India (BoI) has introduced a 175-day tenor fixed deposit at an interest of 7.50 per cent per annum for deposits of ₹2 crore & above to less than Rs.50 crore, amid liquidity tightness in the banking system and credit growth outstripping deposit growth.

This comes on the heels of the State Bank of India (SBI) and Bank of Baroda (BoB) increasing their deposit rates.

The public sector bank, in a statement, said the “Super Special Fixed Deposit”, which has been introduced with effect from January 1, 2024, is a high-yielding avenue for HNIs (high net worth individuals) and Corporates to deploy their surplus funds for the short term.

“The special fixed deposit is for domestic rupee term deposit only. The special fixed deposit is introduced as a limited period offer,” per the statement.

On deposits below Rs 2 crore, BoI currently pays 4.50 per cent interest for a 175-day tenor. In the less than 2-year deposit category, the highest interest rate that the bank is currently paying is 7.25 per cent for a 2-year deposit.

State Bank of India

Last week, SBI increased interest rates on term deposits below ₹2 crore by 25-50 basis points (bps) from December 27, 2023. It also upped interest rates on term deposits of ₹2 crore & above by 5-50 bps.

India’s largest bank effected the highest increase of 50 bps in two maturity buckets -- 7 to 45 days (from 3 per cent to 3.50 per cent) and 180 to 210 days (5.25 per cent to 5.75 per cent).

It effected a 25 bps increase in three maturity buckets -- 46 days to 179 days (from 4.50 per cent to 4.75 per cent), 211 days to less than 1 year (5.75 per cent to 6 per cent) and 3 years to less than 5 years (6.50 per cent to 6.75 per cent).

In the ₹2 crore & above deposit category, SBI effected the maximum increase of 50 bps in two maturity buckets -- 180 to 210 days (from 6 per cent to 6.50 per cent) and 211 days to less than 1 year (6.25 per cent to 6.75 per cent).

In four maturity buckets, the bank effected an increase of 25 bps -- 7 to 45 days (from 4.75 per cent to 5 per cent), 46 to 179 days (5.50 per cent to 5.75 per cent), 2 years to less than 3 years (6.50 per cent to 6.75 per cent) and 3 years to less than 5 years (6 per cent to 6.25 per cent). In the 1 year to less than 2 years tenor, SBI nudged up the interest rate 5 bps from 6.75 per cent to 6.80 per cent.

Bank of Baroda

Bank of Baorda (BoB) increased the interest rates on domestic retail term deposits, including NRO term deposits, by 10 to 125 basis points (bps) on various maturity buckets. BoB’s revised term deposit rates, effective from December 29, 2023, are applicable on deposits below Rs 2 crore.

The bank effected the highest increase of 125 bps on deposits in the 7-14 days tenor to 4.25 per cent (from 3 per cent earlier). The lowest increase is 10 bps on three tenors within the 1-2 years from 6.75 per cent to 6.85 per cent.

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