Half A Dozen Public Sector Banks Cut Lending Rates By Up To 0.25%
Indian rupee banknotes are counted Mumbai, India. (Photographer: Dhiraj Singh/Bloomberg)

Half A Dozen Public Sector Banks Cut Lending Rates By Up To 0.25%

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About half a dozen public sector banks, including Bank Of India, Oriental Bank Of Commerce and Bank Of Maharashtra, have reduced lending rates by up to 25 basis points following a cut in the key policy repo rate by the Reserve Bank of India last month.

With the reduction in their respective benchmark lending rates, home, auto and other loans have become cheaper.

In line with the decision of RBI to reduce repo rate by 25 basis points, the bank has reduced the interest rate applicable for retail segment and micro and small enterprises by similar basis points and the revised repo linked lending rate will be 8 percent effective Nov. 1, Indian Overseas Bank said in a statement.

Bank of India reduces its overnight Marginal Cost of Funds based Lending Rate by 15 basis points and one-year MCLR by 5 basis points or 0.05 percentage point. One basis point is one hundredth of a percentage point.

These revised MCLR would be applicable to the customers of the Bank with effect from Oct. 10. This reduction transmits the change made in RBI policy rate (repo rate) in October, BOI said.

Pune-headquartered Bank of Maharashtra slashed its MCLR by 0.10 percentage point across tenors. The benchmark one-year MCLR will now be priced at 8.40 percent with effect from Oct. 8, the bank said in a regulatory filing.

The other tenors from overnight to six-months have been slashed by equal measure in the range of 8.05-8.30 percent. The lender has also cut down the repo linked lending rate by 0.25 percentage point to 8.20 percent from 8.45 percent earlier with effect from Oct. 8.

Base rate has been kept unchanged at 9.50 percent per annum, Bank of Maharashtra said.

"In view of festival season and in order to extend benefit to customers across retail/micro/small enterprises, Central Bank of India reduced repo based lending rate by 25 basis points (0.25 percentage point) with effect from today, the Oct. 10," the lender said.

Accordingly, interest rate on housing loans (low risk category) stands reduced from 8.25 percent to 8 percent and for MSE loans it stands reduced to 8.95-9.50 percent from 9.20-9.75 percent, Central Bank of India said.

Oriental Bank has cut the MCLR on one-year tenor loan to 8.35 percent from 8.40 percent earlier. The new rate will come to effect from Oct. 10, it said in a release.

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