Two largest private banks of India ICICI Bank and HDFC Bank on 3 December 2014 decided to lower Fixed Deposit (FD) rates.
ICICI Bank lowered its term deposit rates by 25 basis points (bsp) while HDFC Bank lowered its interest rates by up to 50 bsp on various maturities.
Following the revision, the highest rate offered by the HDFC bank is 8.75% on deposits above one year. HDFC Bank's new fixed deposit rates are applicable from first week of December 2014.
The revised rate of ICICI bank will come into effect from 28 November 2014.
The banks have been flushed with liquidity due to deposit growth outpacing the growth in advances. Bankers say that there is no fresh investment demand from corporate.
Although banks have been bringing down deposit rates, no bank has recently reduced its base rate — the benchmark rate which determines the pricing of most loans, including home loans.
Bankers have said that they are waiting for a signal from the central bank that the downward movement is sustainable.
When: 3 December 2014