State-run Bank of Baroda Ltd. today raised its lending rates by five basis points across various tenures, effective July 7. The bank increased its one-year marginal cost of funds based lending rates to 8.50 percent.
The increase in the MCLR is attributed to higher cost of fund and rising interest rate scenario, the bank said in a statement today.
The overnight, one month, three months and six months rates have been revised to 8 percent, 8.05 percent, 8.15 percent and 8.35 percent, respectively.
Last month also the bank had increased its MCLR by five basis points for all the tenures.
In its second bi-monthly monetary policy review, the Reserve Bank of India on June 7 had hiked the repo rate by 0.25 percent to 6.25 percent, for the first time in over four years.
Repo rate is the rate at which the RBI lends to other banks in case of any shortfall of funds. Following the RBI rate hike, many lenders increased their lending rates across various tenures.