SBI hikes rates by 0.75%, loans to acquire dearer
Country's largest lender SBI on Tuesday raised lending rates by 0.75 % points, making all types of loans, including housing and auto, costlier for both new and existing borrowers.
Giving some relief to depositors, State Bank of India (SBI) also hiked interest rates on fixed deposit of short term maturities by up to 2.25 percentage points.
SBI hiked base rate, or the minimum lending rate, by 0.75 % to 9.25 %. The hike is effective from May 12, SBI said in a statement.
SBI has also increased its benchmark prime lending rate (BPLR) by 0.75 % which would mean that existing borrowers will also have to pay more for their loans.
With this hike, SBI's BPLR goes up to 14 %. This will make equated monthly installments for existing loans dearer by at least 0.75 %.
Banks have been on a rate hike spree since the Reserve Bank's decision to raise short-term key rates in its annual credit policy on May 3.
Over a dozen banks, including Punjab National Bank, ICICI Bank, Oriental Bank of Commerce and Corporation Bank have raised interest rates in past one week.
Most of the banks hiked lending rates by 0.5 percentage points in the past one week. SBI has taken a more aggressive stance by hiking lending rates by 0.75 percentage points.
For depositors, interest rates have been hiked in maturities slab of up to 180 days to align this with the hike interest rate for savings bank accounts.
The Reserve Bank had upped the interest rates on savings bank accounts to 4 % from 3.5 % in its annual credit policy on May 3.
Interest rate for term deposit with maturity of 7-14 days will go up by 2.25 % to 6.25 % from existing 4 %, while 15-45 days fixed deposit will earn 125 bps more at 6.25 %.
For term deposits of 46-90 days of maturity, interest rate has been increased by 0.75 % to 6.25 %. At the same time, 91-180 days fixed deposit will earn 7 % compared to 6 %.
The new deposit rates would also be effective from May 12. Meanwhile, State Bank of Mysore has also raised its base rate and BPLR by 0.5 percentage points, effective on Wednesday. Base rate of State Bank of Mysore would be 9.50 % compared to 9 % while BPLR will go up to 14.25 %.
Giving some relief to depositors, State Bank of India (SBI) also hiked interest rates on fixed deposit of short term maturities by up to 2.25 percentage points.
SBI hiked base rate, or the minimum lending rate, by 0.75 % to 9.25 %. The hike is effective from May 12, SBI said in a statement.
SBI has also increased its benchmark prime lending rate (BPLR) by 0.75 % which would mean that existing borrowers will also have to pay more for their loans.
With this hike, SBI's BPLR goes up to 14 %. This will make equated monthly installments for existing loans dearer by at least 0.75 %.
Banks have been on a rate hike spree since the Reserve Bank's decision to raise short-term key rates in its annual credit policy on May 3.
Over a dozen banks, including Punjab National Bank, ICICI Bank, Oriental Bank of Commerce and Corporation Bank have raised interest rates in past one week.
Most of the banks hiked lending rates by 0.5 percentage points in the past one week. SBI has taken a more aggressive stance by hiking lending rates by 0.75 percentage points.
For depositors, interest rates have been hiked in maturities slab of up to 180 days to align this with the hike interest rate for savings bank accounts.
The Reserve Bank had upped the interest rates on savings bank accounts to 4 % from 3.5 % in its annual credit policy on May 3.
Interest rate for term deposit with maturity of 7-14 days will go up by 2.25 % to 6.25 % from existing 4 %, while 15-45 days fixed deposit will earn 125 bps more at 6.25 %.
For term deposits of 46-90 days of maturity, interest rate has been increased by 0.75 % to 6.25 %. At the same time, 91-180 days fixed deposit will earn 7 % compared to 6 %.
The new deposit rates would also be effective from May 12. Meanwhile, State Bank of Mysore has also raised its base rate and BPLR by 0.5 percentage points, effective on Wednesday. Base rate of State Bank of Mysore would be 9.50 % compared to 9 % while BPLR will go up to 14.25 %.
Source: [NDTV]
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