Half dozen public sector banks cut lending rates by up to 25 bps; home, auto loans to become cheaper

New Delhi: About half a dozen public sector banks, including Bank of India, Oriental Bank of Commerce and Bank of Maharashtra, have reduced lending rates by up to 25 basis points following a cut in the key policy repo rate by the RBI last month. With the reduction in their respective benchmark lending rates, home, auto and other loans have become cheaper. In line with the decision of RBI to reduce repo rate by 25 basis points (bps), the bank has reduced the interest rate applicable for retail segment and micro and small enterprises by similar basis points and the revised repo linked lending rate will be 8 percent effective 1 November, Indian Overseas Bank said in a statement. Bank of India reduces its overnight MCLR by 15 bps and one-year MCLR by 5 bps or 0.05 percentage point. One bps is one-hundredth of a percentage point. [caption id="attachment_4306961" align="alignleft" width="380"]

Representational image. Reuters.[/caption]These revised MCLR would be applicable to the customers of the Bank with effect from 10 October, 2019. This reduction transmits the change made in RBI policy rate (Repo rate) on October 2019, BOI said. Pune-headquartered Bank of Maharashtra slashed its MCLR by 0.10 percentage point across tenors. The benchmark one-year marginal cost of funds based lending rate (MCLR) will now be priced at 8.40 percent with effect from 8 October, 2019, the bank said in a regulatory filing. The other tenors from overnight to six-months have been slashed by the equal measure in the range of 8.05-8.30 percent. The lender has also cut down the repo linked lending rate (RLLR) by 0.25 percentage point to 8.20 percent from 8.45 percent earlier with effect from 8 October. Base rate has been kept unchanged at 9.50 percent per annum, Bank of Maharashtra said. "In view of festival season and in order to extend the benefit to customers across retail/micro/small enterprises, Central Bank of India reduced repo based lending rate (RBLR) by 25 bps (0.25 percentage point) with effect from today, the 10th October 2019," the lender said. Accordingly, the interest rate on housing loans (low-risk category) stands reduced from 8.25 percent to 8 percent and for MSE loans it stands reduced to 8.95-9.50 percent from 9.20-9.75 percent, Central Bank of India said. Oriental Bank has cut the MCLR on one-year tenor loan to 8.35 percent from 8.40 percent earlier. The new rate will come to effect from 10 October, it said in a release.