INDIA: Rising FD rates to bring some cheers for depositors

NEW DELHI (Press Trust of India), June 17, 2008: There is some good news for retired persons and those dependent on the interest income as banks have started increasing their fixed deposit rates following the decision of the RBI to hike the short term lending rate by 0.25 per cent. Oriental Bank of Commerce yesterday revised their fixed deposit rates for various maturities and raised the rates for its special deposit scheme Asha Kiran (FDs for 400 days) to 9.75 for senior citizens. This is probably the highest interest rate being offered by the city based public sector lender on 13-month deposit. Though the senior citizens would get a rate of 9.75 per cent, others will receive 9.25 per cent for 400-day fixed deposit from OBC. Even the new generation private sector lender Yes Bank increased the deposit rates by 0.5 per cent across all maturities. After the recent revision of interest rates by Yes Bank, senior citizens would get a maximum of 10 per cent on fixed deposits with a maturity of one year to 18 months. The others would receive a return of 9.5 per cent. Country's largest public sector lender, State Bank of India, also revised fixed deposit rates upward by up to 0.5 per cent for selected tenures effective June 1. SBI increased fixed deposits rate for 5-10 years by 0.5 per cent to 9 per cent while 3-5 years tenure was hiked by 0.35 per cent. Senior citizens will get 0.5 per cent more. © Copyright PTI 2008