No immediate cut in lending rates: SBI
State Bank of India (SBI) Monday ruled out any immediate cut in lending rates even as the Reserve Bank had reduced policy rate by 0.25 percent earlier this week.
New Delhi: State Bank of India (SBI) Monday ruled out any immediate cut in lending rates even as the Reserve Bank had reduced policy rate by 0.25 percent earlier this week.
"With repo rate (short-term lending rate of RBI) cut, we don't get savings because our total repo borrowing is 20,000 crore," SBI Chairman Pratip Chaudhuri said here.
"So if you (RBI) reduce rate by 25 basis points, the saving is 50 crore. Total advances is 5 lakh crore which comes to 1 bps," he said.
Had there been a cut in CRR, it would have would have provides room for cut, he said. The bank will continue with the same lending and deposit rate as of now, he added.
Earlier this week, RBI lowered the short-term lending (repo) rate to 7.25 percent from 7.50 percent, lowest since May 2011 while retaining the CRR for banks unchanged at 4 percent.
Country's largest lender SBI last reduced its lending rate in January by cutting it by 0.05 percent.
Following the marginal reduction, SBI's base rate, or the minimum rate of lending, came down to 9.70 percent from 9.75 percent.
The old benchmark prime lending rate also came down by a similar 0.05 percent.
Meanwhile, state-owned HUDCO reduced housing loan rates for individual borrowers under its Niwas Portfolio. Its lending rate for individual borrowers has been lowered to 9.95 percent for loans upto Rs 25 lakh.
Housing finance company DHFL also has reduced its interest rate by 0.25 percent. The revised rate is applicable for all new loans.