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News: As per media sources, State Bank of India (SBI) has slashed its savings account interest rate by 20 bps on balances below ₹10 crore and by 50 bps on balances of ₹10 crore and above, bringing both to a uniform 2.5%, effective June 15. This marks the first savings rate revision since October 2022 and aligns with the RBI’s recent 50 bps repo rate cut. Additionally, SBI has lowered fixed deposit (FD) rates for the third straight month, with a 25 bps cut in select buckets below ₹3 crore. Over the last three months, cumulative FD rate cuts stand at 70 bps.
View: With a cumulative 70 bps FD rate cut over the past three months and a uniform 2.5% savings account rate, SBI has built meaningful headroom to cushion NIM pressures in FY26. The continued repricing of deposits enhances transmission efficiency, while the recent CRR cut provides a direct boost to margins. Additionally, softening yields open up scope for treasury gains, further supporting overall profitability.
Impact: Positive