Financial Daily from THE HINDU group of publications
Sunday, Dec 18, 2005
Financial Daily from THE HINDU group of publications Sunday, Dec 18, 2005 |
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Fixed Deposits Money & Banking - Interest Rates Canara Bank hikes term deposit rates Our Bureau
Bangalore , Dec. 17 CANARA Bank has hiked domestic term deposit rates, effecting an increase of 50 basis points for maturities up to two years. A release said that the term deposit rates between 46 days and 90 days are now 5 per cent, and 5.75 per cent for two years.
Banking sources said that the rate hike was triggered by the big increase in credit demand, especially non-food credit. Credit growth is currently at an all-time high of 30 per cent, though some of the banks have managed to show higher rates of growth. The rate hike is mostly for short and medium-term deposits, since not many banks are prepared to take hazard a long-term guess on interest rates. However, the deposit rate hike has not sparked off any lending rate hikes. This was because in the short term, lending rates are forecast to remain stable. Any rate hike in the benchmark prime lending rates is likely only after the next fiscal, the bankers said.
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