Country’s largest bank State Bank of India (SBI) today raised lending rates by 50 basis points, making its home, auto and corporate loans costlier.
The bank revised the base rate, or the minimum lending rate, upwards by 50 basis points from 9.50 per cent to 10 per cent, effective from August 13, State Bank of India said in a statement.
The benchmark prime lending rate (BPLR) also goes up by similar percentage points to 14.75 per cent, making loans for existing borrowers dearer by at least 50 basis points.
Following the Reserve Bank’s decision to raise short-term key rates in its first quarter review of monetary policy last month, lenders have responded by increasing interest rates.
Over two dozen banks, including Punjab National Bank, Bank of Baroda, Oriental Bank of Commerce have raised interest rates.
The RBI had raised the short-term lending (repo) rate by 50 basis points to 8 per cent and the short-term borrowing (reverse repo) rate by a same margin to 7 per cent. The central bank had hiked key policy rates 11 times since March 2010 in its bid to tame inflation.
Subsequently, the interest rate under the Marginal Standing Facility, an additional borrowing window, has gone up to 9 per cent from the earlier level of 8.5 per cent.