Mumbai: Public sector lender Union Bank of India (UBI) on Saturday hiked its benchmark prime lending rate (BPLR) by 25 basis points (bps) to 14.50%.
The move comes a fortnight after the lender increased its base rate, or the minimum rate of lending, by a similar 25 bps to 10.25%.
The BPLR preceded the base rate system that came into effect from July 2010. However, a majority of the older loans continue being under BPLR due to which the rate adjustments are made by banks.
The Reserve Bank of India (RBI) has raised key rates 10 times since March 2010 in order to tame the headline inflation, which stood at 9.44% for June.
A majority of banks, including the nation’s top two lenders, have raised lending rates since the RBI’s last policy tightening action on 16 June.