SBI reduces home loan rates

The nation’s largest lender State Bank of India on Tuesday cut interest rates on housing loans up to Rs 30 lakh by 10 basis points. 

Accordingly, the interest rate on housing loans below Rs 30 lakh will be in the range of 8.60-8.90 per cent, from 8.70-9 percent earlier.

The public lender has also reduced the lending rates by a marginal 5 basis points across all tenors, effective April 10.

The revised one-year marginal cost of funds-based lending rate (MCLR) stands at 8.50 percent down from 8.55 percent earlier, the bank said in a statement.

The move follows a 25 basis points cut in repo rate by the Reserve Bank in its first monetary policy review announced last week. 

In the February policy review also the monetary authority had lowered the key rates by a similar quantum.

In a 4:2 majority vote, the central bank had cut the repo rate to 6 per cent from 6.25 per cent earlier, citing the need to support growth that has been sluggish since many months. 

It can be noted that banks have been lagging in passing on RBI rate cuts to borrowers, citing higher credit cost due to massive NPA piles and resultant churn in their margins.