HDFC Bank and ICICI Bank Cut FD Rates by 25 Bps After RBI Slashes Repo Rate

Strategic Insights -

As the Reserve Bank of India (RBI) reduced the repo rate to 5.5% by cutting it by 50 basis points, HDFC Bank and ICICI Bank, the country's two largest private sector lenders, have responded by decreasing their fixed deposit (FD) rates by 25 basis points. This move affects deposits under and above Rs 3 crore and aims to aid the transmission of rate cuts in deposit rates. The revised FD interest rates now range from 3% to 6.6% for general citizens and up to 7.10% for senior citizens.

Key Takeaways:

  • HDFC Bank and ICICI Bank have cut their FD rates by 25 basis points in select tenures.
  • The revised FD interest rates for general citizens in ICICI Bank range from 3% to 6.6% and for senior citizens from 3.50% to 7.10%.
  • The highest rate of 6.60% per annum is on a tenure of two years, one day to five years for general customers and 7.10% for senior citizens.
  • HDFC Bank's revised rates for fixed deposits less than Rs 3 crore are in the range of 2.75%-6.60% for general citizens and 3.25%-7.10% for senior citizens.
  • HDFC Bank and ICICI Bank have also revised the interest rates for fixed deposits greater than or equal to Rs 3 crores to less than Rs 5 crore bracket, which are in effect from Tuesday.
  • The interest rates for general citizens are in the range of 4%-6.30% and for senior citizens are in the range of 4.50%-6.80%.
  • RBI has kept the liquidity in surplus in order to aid the transmission of rate cuts in deposit rates.
  • The Monetary Policy Committee (MPC) of the RBI has cut the repo rate by 100 bps since February.
  • According to RBI lending and deposit rate data, the weighted average lending rate on fresh rupee loans and outstanding rupee loans declined by 6 bps and 17 bps respectively, during February-April.
  • The weighted average domestic term deposit rates on fresh deposits declined by 27 bps, while on outstanding deposits declined by 1 basis point during the same period.

Statistics:

  • HDFC Bank and ICICI Bank reduced their FD rates by 25 bps.
  • Revised FD interest rates for ICICI Bank range from 3% to 6.6% for general citizens and 3.50% to 7.10% for senior citizens.
  • Revised FD interest rates for HDFC Bank range from 2.75% to 6.60% for general citizens and 3.25% to 7.10% for senior citizens.
  • Interest rates for general citizens in HDFC Bank and ICICI Bank range from 4% to 6.30%.
  • Interest rates for senior citizens in HDFC Bank and ICICI Bank range from 4.50% to 6.80%.
  • RBI cut the repo rate by 50 bps, bringing it down to 5.5%.
  • Weighted average lending rate on fresh rupee loans declined by 6 bps during February-April.
  • Weighted average lending rate on outstanding rupee loans declined by 17 bps during February-April.
  • Weighted average domestic term deposit rates on fresh deposits declined by 27 bps during February-April.
  • Weighted average domestic term deposit rates on outstanding deposits declined by 1 basis point during February-April.

Sources:

  • Reserve Bank of India (RBI)
  • HDFC Bank
  • ICICI Bank
  • IE Online Media Services Pvt. Ltd., distributed by Contify.com