Indian Bank raises deposit rates by 15 basis points

The state-owned lender said it would offer higher rates on special term deposits effective from October 23.

The interest rate on 555 days deposits has been increased to 6.80% from 6.65% while the rate on the 777 days scheme would carry 6.75% instead of 6.60%.

Earlier, Indian Bank managing director Binod Kumar told ET that the bank does not have surplus liquidity as it shed Rs 10,000 crore of bulk deposits and slowed term deposits mobilisation during the second quarter while it raised $2.3 billion (about Rs 21,000 crore) of foreign currency non-resident-bank (FCNR-B) deposits using the regulatory window.

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The broader inter-bank market has however been flush with surplus funds following a record $133 billion FCNR-B mobilisation at the sectoral level forcing the RBI to conduct aggressive liquidity drain-out operations.