SBI cuts deposit rates effect from October 5,2009

India’s largest bank SBI has announced that they are reducing the interest rates on all their domestic fixed deposit schemes by 0.25%. This is with effective from October 5, 2009.

“We have brought down term deposit rates gradually. Going forward, this will marginally improve our net interest margin. We have not taken a call on reducing our benchmark prime lending rate,” said a senior SBI official.

The maximum interest rate that SBI will offer is 7.50 per cent (currently 7.75 per cent) on a long-term deposit of eight to 10 years.

At the short end, a term deposit of 15-45 days’ maturity will earn 2.75 per cent (3 per cent).

Last month, the bank discontinued its 1,000-day term deposit scheme by merging its scheme of two years to less-than-three-years.

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