The lender has increased its one-year bulk deposit rate to 7.3 percent
Bank of Baroda (BoB), which recently underwent a three-way merger with Dena Bank and Vijaya Bank, has increased interest rates on deposits above Rs 10 crore by up to 75 basis points (100 bps=1 percentage point) for some tenures.
The lender has increased its one-year bulk deposit rate to 7.3 percent. Interest rates on deposits maturing between 271-365 days and one-to-two years have been increased to seven percent and 7.05 percent, respectively. The new rates are applicable from April 8.
Bulk deposits constitute high cost funds for banks as they carry a higher rate of interest as compared to retail deposits. As per regulatory norms, deposits above Rs 2 crore fall in this category.
After the central bank's policy rate cut on April 4, BoB has left its marginal cost-based lending rate unchanged. Other lenders like the State Bank of India, HDFC Bank, Bank of Maharashtra and Bank of India have reduced their MCLR by 5-10 bps in response to the rate cut.