Sundaram Home cuts deposit rates

Retail loan growth to stay muted: MD

Sundaram Home Finance has revised the interest rates on deposits with effect from May 1.

Interest rates on fresh deposits and renewals for senior citizens stand revised at 7% from 7.5% per annum for deposits of 12 and 18 months’ tenures and to 7.25% (7.75%) a year for deposits with 24, 36, 48 and 60 month tenures, according to a statement.

The interest rate for individuals has been revised to 6.75% (7%) a year for 12 / 18 months and to 7% (7.25%) for 24, 36, 48 and 60 month tenures.

For trusts, the interest rate stands revised at 6.75% (7%) for 12/18 months, 7% (7.25%) for 24 months and 7.25% (7.75%) for 36, 48 and 60 months deposits.

Deposits

The company’s registered a 35% growth in its deposits to ₹1,605 crore for the year ended March 2020.

“Last year, we saw a strong growth in deposits with a net accretion of more than ₹430 crore. Even during the lockdown period, we have been receiving renewal applications as well as new deposit enquiries,” said Lakshminarayanan Duraiswamy, managing director, Sundaram Home Finance.

Muted growth

On the outlook for the sector, Mr. Lakshminarayanan said, “Currently, it is difficult to predict how much of a demand impact COVID-19 would have on the real estate sector. Even before the lockdown, the real estate sector was facing a lot of headwinds. Hence, I expect the growth in retail home loans to be muted in the near term.”

“While demand for housing finance will mirror the demand for real estate, I do see a rise in mortgage loans in the short term,” he said.