‘Freed savings rate bad for big banks’

Deutsche Bank believes that savings bank deposit interest rate deregulation is potentially negative for some of the larger banks which have high savings account balances- State Bank of India (33 per cent),HDFC Bank (30 per cent),ICICI Bank (30 per cent),Punjab National Bank (30 per cent) and Axis bank (22 per cent).

Over the longer term,we believe that eventually banks will pass on the increased funding costs if any or increase the charges fees related to the savings account,but we do not rule out some volatility in savings interest rates in the near term,which may be somewhat negative for larger banks,said Deutsche Bank.

At 1:19 pm shares of SBI,HDFC Bank,ICICI Bank,PNB,Axis Bank were down 0.5-4.72 per cent.