PNB cuts savings deposits rate by 10 bps to 2.9%, effective Sept 1

Bank officials said the decision is partly driven by huge liquidity that the bank continues to manage and also correction in rates vis-a-vis peers, especially PSU banks

State-owned lender Punjab National Bank (PNB) has reduced savings deposit rates by 10 basis points to 2.90 per cent. This compares with deposit rate of 2.70 per cent and 2.75 per cent offered by State Bank of India (SBI) and Bank of Baroda (BoB), respectively.

The cut in the interest rate--effective from September 1--will be applicable on existing as well as new savings fund accounts, the lender said.

Bank officials said the decision is partly driven by huge liquidity that the bank continues to manage and also correction in rates vis-a-vis peers, especially public sector banks.

The lender has been offering 2.90 per cent to 5.25 per cent interest on term deposits with a period of 7 to 14 days and 5 to ten years, respectively from August 1. Deposit rates for senior citizens range from 3.40 per cent to 5.75 per cent.

The public sector bank has also announced that it will waive all service charges, processing fees and documentation charges on home loans, vehicle loans, personal loans, pension loans and gold loans. The offer can be availed both through bank branches and digital channels. The processing fee waiver will be available until December 31, 2021. 

Last month, country’s largest lender SBI had waived 100 per cent processing fee on home loans as well as car loans.

PNB offers interest rate starting from 6.80 per cent on home loans and 7.15 per cent on car loans. Personal loans by the lender are offered at 8.95 per cent. 

The lender, in a press statement, said it is confident that this festive season will see an encouraging revival in overall consumer spending, thereby boosting its credit portfolio.

Bank	Prevailing Interest Rate	CASA deposits % of total deposits – June 2021
Punjab National Bank	2.9%	45.15%
State Bank of India	2.70%	45.97%
Union Bank	3.00%	36.39%
Bank of Baroda	2.75%	43.21%
Canara Bank	2.90%	32.51%

Source: Bank websites; BSE filings