Bank of India increases rate on bulk deposits

Recently, Federal Bank and Dena Bank also increased rates on deposits of some maturities, by 25-30 bps

Bank of India has increased the interest on deposits of Rs 10 crore and above having maturity of one year and above to less than two years, to 9 per cent from 8.75 per cent earlier, with immediate effect. The bank announced this in a notice on the Bombay Stock Exchange.

Recently, Federal Bank and Dena Bank had also increased rates on deposits of some maturities, by 25-50 basis points.

Banks usually offer higher deposit rates towards the end of the quarter in a bid to shore up their deposit base. But the Finance Ministry has recently issued a directive asking banks to restrict the share of bulk deposits to not more than 15 per cent of total deposits, as it was putting pressure on margins.