BoB, IDBI hike NRE, FCNR rates by 20-30 bps

Bank of Baroda (BoB) and Industrial Development Bank of India (IDBI) today announced an increase 20-30 basis points in interest rates on non-resident deposits, to align with the rise in Libor (London inter-bank offered rates). One basis point is one-hundredth of a percentage point.

IDBI also effected a sharp 52-basis point hike in interest rates offered on non-resident (external) savings deposits to 4.23 per cent.

Libor has seen a rise of 25-30 basis points in the last one month, reflecting hikes in the US Federal Reserve's key funds rate, IDBI official said.

The US Fed increased its funds rate by 25 basis points to 4.0 per cent this week, following on an identical hike in October.

On NRE deposits, BoB raised interest rate for deposits of one year to less than two years to 5.20 per cent from 5.0 per cent, for two years to less than three years to 5.40 per cent from 5.10 per cent, and for three years to five years to 5.40 per cent from 5.10 per cent.

BoB said for FCNR deposits in dollars, the interest rate for one year to less than two years' period had been increased to 4.49 per cent from 4.25 per cent, for two years to less than three years to 4.61 per cent from 4.34 per cent. The interest rate on deposits for three years to less than four years has gone up to 4.66 per cent from 4.37 per cent, for four years to less than five years to 4.68 per cent from 4.40 per cent, and for five years to 4.71 per cent from 4.42 per cent.

IDBI said it hiked the interest rate for one-year NRE fixed deposits to 5.23 per cent from 4.95 per cent and for the three years to 5.40 per cent from 5.10 per cent. The bank's interest rate on one-year FCNR deposits moved up to 4.47 per cent from 4.21 per cent and for five-year deposits to 4.70 per cent from 4.30 per cent.