Written byShalini Ojha
On Monday, the State Bank of India (SBI) announced that it would reduce MCLR (marginal cost of lending rate) on loans across all tenors.
While this move will provide relief to borrowers, the public sector bank also announced that it would reduce Fixed Deposit (FD) rates.
The bank has reduced FD rates by 20-25 basis points (bps) across all tenors.
Further, for bulk depositors, FD rates were cut by 10-20 bps across all tenors. This is the third time in the last two months that SBI slashed FD rates.
For FDs less than Rs. 2 crore, the rate remained unchanged at 4.5% if it matures between 7 and 45 days.
For those maturing between 46 and 179 days, the rate is 5.5%.
The rate was brought to 5.80% for FDs maturing from 180 to 210 days. The same rate was kept for FDs maturing from 211 days to less than a year.
FD rate was fixed at 6.50% for FDs maturing between 1 and 2 years.
Those maturing between two and three years will get a rate of 6.25%. FDs maturing between 3-5 years, and 5-10 years will also get the same rate.
Senior citizens will continue to get an additional 50 basis points over the FD interest rates. While the rates remained unchanged for FDs maturing between 7-45 days (5%) and 46-179 days (6%), SBI slashed rates for FDs maturing between 180-210 days to 6.30%.
For FDs maturing between 211 days to less than 1 year, the rate was fixed at 6.3%.
The rates for FDs maturing in 1-2 years was kept at 7%; for those maturing between two and three years, it was kept at 6.75%. For those maturing between 3 and 5 years, and 5-10 years, the FD rate was fixed at 6.75%.
The changes will come to effect from tomorrow, September 10, said SBI.
The bank decided to slash interest rates by 10 bps (1 bps = 0.01%), across all tenors.
Due to this, the one-year MCLR will come down to 8.15% a year from the existing 8.25%. This is the fifth consecutive time SBI announced MCLR cut in FY 2019-20.
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