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HDFC to raise home loan rates by 0.5%

HDFC will raise home loan rates by 0.5 per cent by February end or early March, Chairman Deepak Parekh said here on Thursday.

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NEW DELHI: A key player in the home loan market, HDFC will hike housing loan rates by another 0.50 per cent this month-end or early March.

 

"After the CRR hike, our margins, presently at around two per cent, are under pressure and we will raise the interest rate to maintain that spread," HDFC Chairman Deepak Parekh said.

 

This would be the second time within a month that HDFC would be raising home loan rates. Earlier this month, it raised the rates by 0.5 per cent after RBI announced a 0.25 per cent hike in overnight lending rate, Repo, in its monetary review. ICICI Bank had also raised home and car loans by one per cent then.

 

Four PSU banks -- PNB, Bank of India, Bank of Baroda and Union Bank of India-- hiked their prime lending rates from Thursday, which would affect some personal loans, corporate advances, credit to small-scale industries and agriculture loans above Rs two lakh. However, home and car loans would not be affected by the move.

 

These banks revised the PLR since RBI announced that banks would have to keep more money as cash with the central bank. The move, technically called raising of cash reserve ratio, was made to tame inflation which touched more than a two-year high of 6.73 per cent in early February.

 

CRR will be hiked by 0.50 per cent in two phases which will suck out close to Rs 14,000 crore from the system.

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