BoI raises deposit rates by 75-150 bps

Mumbai: Public-sector lender Bank of India (BOI) has increased interest rates on wholesale and bulk deposits by 75-150 basis points (bps) across various maturities. Interest rates on retail domestic term deposits have also been raised by 25-50 bps.

The maximum increase for large deposits that cover denominations of 1 crore and above are in the 91-179 days and 270-364 days maturity buckets. While interest rates for the former were increased to five percent against the earlier 3.5 percent, the latter's new rate is 6.5 percent compared to five percent earlier. With the interest rates cycle having changed and Certificate of Deposits quoting above six percent, the bank will review interest rates in April, after the Reserve Bank of India announces annual policy for 2010-11.

The deposit rates have earlier been raised on two accounts. First, there is a rush to garner resources before close of the financial year. Second, all banks look to retain deposits, which come up for renewal on maturity, at a time when consumer inflation is ruling in double digits.