The Business Bytes
TBB BUREAU
MUMBAI, DEC 28, 2023
Public sector lender Bank of Baroda (BoB) on Thursday announced increase in the interest rates on domestic retail term deposits by up to 125 basis points in various maturity buckets.
The revised rates will come into effect from Friday. The new rates will be applicable for domestic deposits below Rs 2 crore, including non-resident Indian ordinary (NRO), BOB said in a statement.
BoB said the increase in rates is largely focused on shorter-term maturity buckets, specifically those less than one year. Increasing interest rates in shorter-term maturities will not only greatly benefit depositors who keep deposits for shorter maturities but will also contribute to the Bank’s objective of balancing and optimising the overall cost of deposits and protecting its Net Interest Margin (NIM). This is also in line with the Bank’s strategy to increase its share of shorter-term retail term deposits.
“The decision to increase retail term deposit rates underscores Bank of Baroda’s commitment to offering higher value to our customers, while strategically managing our deposit portfolio. We believe this step will not only attract more customers as they earn more on their savings, but will also help the Bank optimise its cost of deposits, thereby safeguarding our Net Interest Margin,” said Ravindra Singh Negi, Chief General Manager – Retail Liabilities & NRI Business, Bank of Baroda.
