Bank of Baroda hikes interest rates on loans and deposits
SUMMARY
Bank of Baroda, one of India’s leading public sector banks, has announced an increase in interest rates for loans and deposits. The bank has hiked lending rates by up to 0.05% across various loan categories, including home, auto, and personal loans. The overnight Marginal Standing Facility (MSF) rate has been increased to 7.95%.
H3: Bank of Baroda increases lending rates
Bank of Baroda has announced a hike in lending rates by up to 0.05% for various loan categories. The increase is applicable to home, auto, and personal loans, among others. The bank has stated that the move is in response to the rising cost of funds and the increased competition in the market.
H3: Overnight MSF rate increased
The bank has also increased the overnight Marginal Standing Facility (MSF) rate to 7.95%. The MSF is a window for banks to borrow funds from the Reserve Bank of India (RBI) overnight against government securities. The increase in the MSF rate is aimed at encouraging banks to borrow from the RBI instead of borrowing from the market.
H3: Impact on deposits
The bank has also increased the interest rates on certain deposit schemes. The interest rate on deposits with a maturity period of 3 years to less than 5 years has been increased to 5.70%, while the interest rate on deposits with a maturity period of 5 years and above has been increased to 5.80%.
This move by Bank of Baroda is likely to have a ripple effect on other public sector banks, which may also increase their lending rates and deposit rates. However, it remains to be seen how this will impact the borrowing and investment decisions of customers.
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