SBI, ICICI Bank have hiked lending rates 50 bps

By | July 1, 2011

A recent press report said that State Bank of India and ICICI Bank have raised their lending rates, the second time in the last one month.

Reports said that SBI has  increased its base rate and benchmark prime lending rate (BPLR) by 50 basis points each to 10 per cent from 9.50 per cent and 14.75 per cent from 14.25 per cent respectively.

ICICI Bank has hiked its base rate and BPLR by 50 basis points each to 10 per cent and 18.75 per cent respectively. In this case too, the rate hikes are effective from August 13.

Reports said that except for agriculture advances, the hike in the lending rate benchmarks will impact borrower’s home loan, auto loan, personal loan, business loan etc.

SBI, India’s biggest bank, had last hiked the base rate and BPLR by 25 basis points each in early July to 9.50 per cent and 14.25 per cent respectively. Reports added saying that SBI has increased the interest rate of deposits on only one maturity bucket — 180-240 days — by 50 basis points to 7 per cent.

Mr. Diwakar Gupta, Managing Director, State Bank of India said that the bank was ensuring short-term liquidity by increasing the deposit rate at the short-end. The bank has not increased the long-term deposit rates as that would give an upward bias to the deposit rates in the banking system.

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About Pradeep Yuvaraj

Pradeep Yuvaraj is a Co-Founder and Director at Finerva Financial Solutions Private Limited, a financial education company focused on personal finance education. He has penned over 250 articles relating to Personal Finance and clocked over 500 hours of educating individuals on managing personal finance. He is a serial entrepreneur and has been associated with 7 Start-ups. His entrepreneurial experience spans industries as varied as Education, Gas Engineering, Automobile Design, Software development and more recently a Pure play presentation design company. Prior to turning entrepreneur in 2005, he has worked for 3 of the top ten companies of the world - Shell, ExxonMobil and Total SA. This experience included handling Branch Operations, Channel Sales and Business Development across 5 states over a period of 8 years. He holds an MBA from Symbiosis and an Electronics Engineering Degree from the University of Pune.

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