Mumbai: Premier public sector lender, Union Bank of India (UBI), has hiked its benchmark prime lending rate (BPLR) by 0.75%.
The new rate, applicable retrospectively from 11 March this year, will be 13.25% as against the earlier 12.5%, the bank said in a release on 12 April.
The bank had last raised its BPLR on February 19 by 0.5%.
“The bank has decided on this revision taking into consideration the recent hike in CRR and repo rate and its likely impact on cost of funds with resultant pressure on the spread,” the bank said in its release.
Though the increase will impact advances with floating interest rate structure linked to BPLR, the bank said that “this increase in BPLR will not apply to the bank’s existing housing loans, which have been granted on a floating rate basis.”
This increase in BPLR will help the bank improve spreads and the bottomline of the bank, it said.