HDFC Bank cuts SB rate by 50 bps

HDFC Bank, in a regulatory filing on Thursday, has set the new savings deposits rates. The bank has cut the deposit rates by 50 bps to 3.5 per cent for deposits below Rs 50 lakh and kept the rate at 4 per cent for deposits above Rs 50 lakh. The revised rates will be applicable from August 19, 2017.

Post demonetisation, banks saw tremendous influx of deposits across the nation, which has led to a rise in the cost of deposits of the banks. In the current scenario, banks are struggling with low credit off-take and stressed margins across the board. With a rate cut on deposits, banks expect to trim down the cost of funds in these challenging times.

Recent quarterly earnings also show rising CASA share in deposits across the board, providing the banks with low cost funds. However, due to poor economic activity, the credit off-take has shown a modest growth during the quarter. Till now, State Bank of India, Yes Bank, Bank of Baroda and Karnataka Bank had cut their rates on savings deposits.

HDFC Bank stock is currently trading at Rs,1748 mark down by 1 9.per cent at 9:56 hrs.