The Punjab National Bank (PNB) and the State Bank of India (SBI) have increased their deposit rates by 0.75 per cent and 0.5 per cent respectively for all maturities as they have an abundant availability of funds for lending. The increase in rates will come into effect from Friday for the banks.

Both the banks have borrowed about Rs 90,000 crore on Wednesday from the country’s central bank, the Reserve Bank of India (RBI) for funding their short term funding.

SBI has increased deposit rates by a maximum of 0.75 per cent for the maturity slab of 91- 180 days and 0.25- 0.5 per cent for one- year and three- year maturities. The bank did not its rates for maturities above three years.

PNB increased its rates by 25 bps on slab starting form 91 to 179 days and offers 5.5% for 179 days and 8% for 10 years. It is offering 7.25% for 1-2-year slab.

As for the base rate, PNB on Thursday increased it by 0.5 per cent to 8.5 per cent while SBI reviewed it but decided to maintain it at the level of 7.5 per cent. A major reason for the increase in rates in that the RBI has increased its policy rates five times in the year.

During the year, the RBI had hiked its repo and reverse repo rates by 1.25 per cent and 1.75 per cent to six per cent and five per cent, respectively.