Mumbai: ICICI Bank Ltd, the country’s largest private sector bank on Thursday cut its floating reference rate by 50 basis point to 12.75% from 13.25%,. The floating rate is the rate to which all retail loans are linked. One basis point is one hundredth of a percentage point.
The bank’s floating rate home loans are now between 9.25% and 10%. The bank has also revised its benchmark advance rate by 50 basis point to 15.75%. This is the rate to which all corporate loans are linked.
The cuts also bring ICICI Bank’s floating home loan rates at par with that of Housing Development Finance Corporation Ltd.
“The reduction in lending rates is based on the reduction in cost of funds. We have now reduced rates by 150 basis points in the last six months.’’ said Chanda Kochhar, managing director and chief executive officer, ICICI Bank, in a statement. Other private sector banks are expected to reduce their rates after the public sector banks take the lead and slash rates further.
However, Keki Mistry, managing director, HDFC Ltd, said,“We are not considering a revision in interest rates at this point in time. We had revised our rates in May for existing and new customers.”