More lenders join the rate cut trend

A day after RBI slashed its policy rate by 50 bps, PNB, OBC, BoB, Axis Bank and IDBI Bank cut their base rates

New Delhi : Following the country’s apex bank reducing the repo rate by 50 basis points, major banks across the country have reduced their lending rates.  State-run lenders Punjab National Bank, Bank of Baroda and Oriental Bank of Commerce have trimmed their base or minimum lending rates by up to 0.40 % in response to RBI’s repo rate cut of 50 basis points to 6.75 %.

Punjab National Bank (PNB) cut the base rate by 0.40 % to 9.60 %, Bank of Baroda (BoB) by 0.25 % to 9.65 %, while Oriental Bank of Commerce (OBC) slashed the rate by 0.20 % to 9.70 %. BoB also reduced the Benchmark Prime Lending Rate by 25 basis points to 13.90 %. State-run IDBI Bank also cut its base rate by 0.25 % to 9.75 %.The new rate will be effective from October 5.

In the private sector, Axis Bank pioneered the recent rate cut, revising its base rate by 35 basis points from 9.85% to 9.50%. The base rate is the minimum rate of interest at which a bank can lend to its borrowers.

Country’s largest lender State Bank of India, Andhra Bank and Bank of India were among the first to cut base rate in the range of 0.20-0.40 %.  ICICI Bank — India’s largest private sector bank — and HDFC Bank, however, are yet to decide on a possible rate cut. Presently, their base rates stand, respectively, at 9.7% and 9.35%.