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Posted on Sep 24, 08:15PM | IANS
The government-run State Bank of Patiala (SBP) Monday launched a savings promotion scheme offering annual interest rate of 9.25 percent on domestic term deposits of one year to 555 days.
"In a falling interest rate scenario, the offer is one of the highest by any bank in the country," the bank said in a statement.
The SBP's annual interest rate will be nine percent for term deposits spanning 556 days to less than five years and 8.75 percent for deposits between five and ten years.
According to the bank which is a wholly-owned subsidiary of State Bank of India (SBI), the scheme which came into effect on Sep 13 will close on Sep 28.
For senior citizens, the bank is offering an interest rate that is a tad higher at 9.75 percent. The scheme, will have an annual yield up to 10.11 percent for savings on a quarterly compounded basis.
The development comes as the Reserve Bank of India (RBI) last week cut the cash reserve ratio (CRR) by 0.25 percent to 4.5 percent, injecting Rs.17,000 crore into the system.
Following this many banks including SBI, Axis, ICICI and HDFC Bank had reduced interest rates on their deposits.
SBI on its part has announced a reduction in its benchmark prime lending rate by 0.25 percent to 14.5 percent effect from Sep 27, 2012.
The Patiala-headquartered public sector bank currently has a total business of nearly Rs.1,45,000 crore.