Loans to turn costlier: PSBs hike interest rates

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Public sector banks hike interest rates
To be in line with RBI, slew of public sector banks on Friday lifted base rates by a hefty of 50-75 basis points with effect from August 1.

RBI raised repo rate and reverse repo rate by 50 basis points each earlier this week. In turn, major public sector banks also revised their base rates and benchmark prime lending rates (BPLR).

Below are the revised rates of the banks:

  • The country's second largest public sector lender Punjab National Bank (PNB) raised its base rate and BPLR by 75 basis points to 10.75% and 14.25%, respectively.
     
  • Bank of Baroda (BOB) increased its base rate and BPLR by 50 basis points, making it to 10.75% and 15%, individually.
     
  • Industrial Development Bank of India (IDBI) hiked base rate and BPLR by 75 basis points each. With this, its base rate will go up to 10.75% and BPLR to 15.25%.
     
  • The interest rate hikes have been undertaken “keeping in view the measures announced by the RBI, inflation and liquidity scenario," an IDBI statement said.
     
  • Oriental Bank of Commerce, a mid-size lender, has also gone in for a 50 basis points rise in its base rate and BPLR to 10.75% and 15%, respectively.
     
  • Mumbai-based Central Bank, hiked its base rate by 75 basis points to 10.75% and BPLR by 50 basis points to 15%. The Bank raised its deposit rates by 40 basis points in the short term.
     
  • Bangalore-based Canara Bank and Bank of India too raised their base rates by 50 basis points and 75 basis points, respectively.

India's top biggie banks like SBI, ICICI Bank and HDFC Bank still to follow the cues from the central bank.

A hike in the base rates and the BPLR means that home loans, car loans and personal loans would turn expensive both for existing and new borrowers. Now, the loan borrowers will have to shell out more money in their EMIs. On the flip side, this may be a good news for savers in a bid to rise in deposit rates.

OneIndia Money

Read more about: rbi, interest rates, banks
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