Kotak Mahindra Bank today said it expects 50% growth in saving bank deposits this fiscal.
The private sector bank has already posted a growth of 68% in saving bank deposits at Rs 5,540 crore as on June 30, 2012 as against deposits of Rs 3,307 crore in corresponding period of last fiscal."We expect 50% growth from saving bank deposits in current fiscal," the bank's President (Consumer Banking) KVS Manian told reporters here.
The bank offers 6% rate of interest on saving bank balances above Rs 1 lakh and 5.5% for balances up to Rs 1 lakh
It also offers value added services like cash back on purchases, home banking, doorstop account opening and just in time payment.
Because of offering high rate of interest, bank's saving bank deposits grew from Rs 3,351 crore in 2010-11 to Rs 5,050 crore in 2011-12.
After the deregulation of savings bank interest rate by the Reserve Bank of India in October 2011, Kotak Mahindra Bank was among the first banks to increase rate of interest on Savings Bank account to a record high of 6%, he said.
"The 6% per annum interest offering on saving bank accounts has had a very positive impact as it has enabled customers to match this return with the post-tax yields of term deposits of short to medium tenure.
"Additionally, interest earned on savings account up to Rs 10,000 is now tax free. As a result, a whole lot of customers now have a hassle free option to grow their monies without having to lock it in term deposits," he said.
With car sales in the country slowing down, Kotak Mahindra Bank which is one of the biggest lenders for auto finance said the growth in auto finance might be 15-20% in current fiscal as against 25% in last fiscal.
"Car sales have slowed down a bit but we are still looking at 15-20% growth," he said.
Kotak Mahindra expects 25% growth in total business comprising Rs 42,000 crore of advances and almost equal amount of deposits.
Kotak Bank has also planned to expand in the country by taking total strength of branches from 379 at present to 500 by December, 2013.
