Mumbai: Private sector lender Kotak Mahindra Bank on Tuesday announced an across-the-board upward revision of its lending rates by 0.25% to 16% with immediate effect.
The bank has also increased its fixed deposit rates by a similar percentage point in various retail buckets up to one year. The bank was offering a (benchmark prime lending rate) BPLR-linked lending rate at 15.75%.
The country’s leading banks SBI and ICICI had on Monday increased their lending and deposit rates by 50 basis points.
While the State Bank’s revised rate now stands at 12.25% from 11.75%, its deposit rates went up by 1.5%, ICICI lending rate is at 16.25% now.
ICICI Bank had raised its benchmark lending rate by 50 basis points to 16.25%, making its home, auto and corporate loans costlier. The revised rate will be effective from 18 August, ICICI Bank had said. It has also increased by 50 basis points its floating reference rate (FRR) for consumer loans, including home loans.
At present, the revised FRR will be 13.25%, as against 12.75%.
These slew of rate hikes come days after finance minister Pranab Mukherjee had expressed hope that lenders would not raise their lending rates following RBI’s monetary tightening measures last month.
Since RBI had hiked repo and reverse repo rates or lending and borrowing rates by 25 and 50 bps, respectively, in its monetary policy review on 27 July, most banks had jacked up their lending and deposit rates.
The second largest public sector lender Punjab National Bank was the first one to do so, with a steep 75 bps hike, which was later on followed up by many other state-run lenders like Canara Bank, Bank of India, Union Bank, among others.
Set up in February 2003, Kotak Bank is one of the youngest private sector lenders in the country, with 260 branches in 15 locations and was the first non-banking financial company (NBFC) to convert itself into a scheduled commercial bank.