BackSBI, Allahabad Bank, PSB cut base rate after RBI lowers repo rate
SBI cut its base rateby 15 basis points (bps) to 9.7%
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Mumbai: India’s largest lender State Bank of India (SBI) on Tuesday said that it has cut its base rate—or minimum lending rate-- by 15 basis points (bps) to 9.7%. The rate cut will be effective from 8 June, a senior official of the bank confirmed.
One basis point is one-hundredth of a percentage point.
SBI is one of the three banks that announced a reduction after the Reserve Bank of India (RBI) announced that it has cut its repo rate by 25 bps to 7.25%.
State-owned lender Allahabad Bank reduced its base rate by 30 bps to 9.95% with effect from 8 June, while Punjab & Sindh Bank too reduced its base rates by 25 bps to 10% with effect from Wednesday.
While announcing the monetary policy statement, RBI governor Raghuram Rajan stated that banks must consider passing on the three rate cuts which the central bank has made since January 2015.
Prior to this, SBI had announced a 15 bps rate cut in April this year, along with base rate cuts by private sector lenders such as ICICI Bank and HDFC Bank. Apart from a base rate cut, SBI had also lowered the interest rate on home loans by up to 25 bps in April.
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