Mumbai : Country’s second biggest private sector lender HDFC Bank on Wednesday cut its benchmark lending rate by up to 0.90 per cent, joining over a dozen banks and housing finance companies that have slashed rates in last few days.
The bank’s asset liability committee decided for a cut of 0.75-0.90 per cent in marginal cost of funds-based lending rate (MCLR) across multiple tenures.
When contacted, its executive director Kaizad Bharucha confirmed the move and said this has primarily been driven by the huge amount of liquidity in the system due to demonetisation. “The rates have been calculated based on liquidity position and all benefits have been passed on to borrowers. The new rates are effective January 7,” he told PTI.
Accordingly, the one-year MCLR which is used as the benchmark for a slew of products including home loans has come down 0.75 per cent to 8.15 per cent as against SBI’s 8 per cent and ICICI Bank’s 8.20 per cent. The overnight MCLR, a bank’s most aggressive offering, has been reduced by 0.85 per cent to 7.85 per cent, while the maximum decrease of 0.90 per cent has been effected in the 3 months MCLR which will go down to 7.90 per cent.
Meanwhile, State-run Canara Bank on Wednesday said that it has reduced the minimum cost of funds based lending rates (MCLR) by up to 75 basis points for various maturities.
The new rates are effective from January 7, the bank said in a statement here. The overnight MCLR has been reduced by 70 basis points to 8.20 per cent from 8.90 per cent.
