Banks increase interest rates on bulk deposits as liquidity tightens

Loan, deposit growth gap at 10-year high

interest rate, banks, repo rate
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Rates on three-month corporate deposits are in the range of 6.30-6.50 per cent, up 30-35 bps from a week ago, market participants said.

Subrata PandaAbhijit LeleBhaskar Dutta Mumbai
With surplus liquidity in the system shrinking and deposit growth trailing credit growth by a large margin, banks have hiked interest rates on bulk deposits, suggesting that they are looking for such deposits to meet the credit demand.

Rates on three-month corporate deposits are in the range of 6.30-6.50 per cent, up 30-35 bps from a week ago, market participants said. With liquidity tightening in the system, banks have turned to certificate of deposits (CDs), resulting in outstanding CDs at Rs 2.44 trillion as of September 9, 2022, compared with Rs 0.7 trillion a year ago, registering a growth of

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First Published: Sep 29 2022 | 9:05 PM IST

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