MUMBAI: Two large commercial banks, Bank of India and Bank of Baroda have lowered lending rates by 5 to 20 basis points while country’s largest bank, State Bank of India has said that the bank will pass the benefit of lower rates if RBI removes incremental cash reserve ratio- slice of deposits that banks that does not earn any interest and is parked with RBI-imposed on banks.
Bank of Baroda has pegged its one year marginal cost of lending rates- which minimum rates at which they lend – at 9.05 per cent, down 20 basis points while Bank of India has reduced rates by 5 basis to 9.25 per cent. The new rates would be effective from December 7 and will be applicable only for new customers.
The old customers will get the benefit of new rates from the day their rates are due for reset. SBI charges 8.90 per cent interest rate on one year loan.
SBI’s managing director Rajnish Kumar indicated that the bank will look at lowering rates after RBI removes the incremental CRR requirement. The RBI has asked banks to set aside the entire deposit mobilised between September 16 and November 11 as CRR in order to take out the excess liquidity to the tune of Rs 3.2 lakh crore.
The cut in rates comes a day before the RBI is set announce bi-monthly policy with market expecting a 25 basis points cut in the repo rate which is now at 6.25 per cent. Bank of Baroda would be charging 9 per cent for six months, 9.05 per cent for one to three years and 9.25 per cent for five years.
Banks cut rate lending rates a day before RBI is due to announce policy
Source : ET Realty
Bank of Baroda has pegged its one year marginal cost of lending rates- which minimum rates at which they lend – at 9.05 per cent, down 20 basis points while Bank of India has reduced rates by 5 basis to 9.25 per cent. The new rates would be effective from December 7 and will be applicable only for new customers.
The old customers will get the benefit of new rates from the day their rates are due for reset. SBI charges 8.90 per cent interest rate on one year loan.
SBI’s managing director Rajnish Kumar indicated that the bank will look at lowering rates after RBI removes the incremental CRR requirement. The RBI has asked banks to set aside the entire deposit mobilised between September 16 and November 11 as CRR in order to take out the excess liquidity to the tune of Rs 3.2 lakh crore.
The cut in rates comes a day before the RBI is set announce bi-monthly policy with market expecting a 25 basis points cut in the repo rate which is now at 6.25 per cent. Bank of Baroda would be charging 9 per cent for six months, 9.05 per cent for one to three years and 9.25 per cent for five years.
Banks cut rate lending rates a day before RBI is due to announce policy
Source : ET Realty
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