As bankers line up to raise deposit rates to tackle liquidity shortage in the overall banking system, the country's second-largest private sector lender HDFC Bank on Friday announced a hike in deposit and lending rates by up to 75 basis points (100 basis points is 1 percentage point).
The bank also raised its benchmark prime lending rate by 25 basis point to 16.5% with effect from Friday.
State Bank of India (SBI), ICICI Bank and Punjab National Bank are among the few that have already increased deposit rates.
Punjab National Bank also, on Friday, announced a 50 basis points hike in its base rate to 9% with effect from December 13.
The bank revised the rate of interest on domestic term deposits of various tenor upward by 25-75 basis points.
Interest on term deposits with a tenor of 3 years and 1 day to 5 years will now earn 8.25% interest per annum, compared to the earlier 7.5%.