Impact of RBI repo rate hike: List of banks raises interest rates on home loans
The Reserve Bank of India (RBI) hiked the repo rate for the fifth time in FY23 in an effort to combat inflation.
The Reserve Bank of India (RBI) hiked the repo rate for the fifth time in FY23 in an effort to combat inflation. On December 7, 2022, the central bank announced its most recent monetary policy announcement, increasing the repo rate by 35 basis points to 6.25%. Financial institutions are under influence to increase deposits as a result of the strong credit growth. These increases typically affect loan rates more instantly than deposit rates, which has in fact prompted some banks to announce interest rate hikes on home loan products one day after the RBI announced its repo rate.
Bank of Baroda
Bank of Baroda has mentioned on its website that “Rate of Interest on various Retail Loans Linked with Baroda Repo Linked Lending Rate [BRLLR] w.e.f. 08.12.2022. In terms of guidelines issued by Reserve Bank of India regarding implementation of External Benchmark Based Lending rates. Bank has introduced Baroda Repo Linked Lending Rate (BRLLR) in respect of all Retail Lending products w.e.f 01.10.2019."
Bank of Baroda has also said on its website that “Our BPLR for all the existing accounts is 12.90% per annum w.e.f from 12.10.2022."
“For Retail Loans applicable BRLLR is 8.85% w.e.f. 08.12.2022 (Current RBI Repo Rate: 6.25% + MarkUp/Base Spread 2.60%)," mentioned BOB on its website.
Indian Overseas Bank
IOB has said in a BSE filing that “Revision in Marginal Cost of Funds (MCLR) and Repo Linked Lending Rote (RLLR) with effect from 10.12.2022. Bonk has revised the RLI-R to 9.10% (i.e. 6.25% + 2.85% = 9.10%) with effect from 10.12.2022."
Additionally, the marginal cost of funds (MCLR) has been raised across tenures by 15 to 35 basis points by the Indian Overseas Bank (IOB).
IOB has mentioned on its website that “*0.50% Special Interest Concession to Borrowers with CIC Score of 800 and above, 0.20% To borrowers for financing Electric 4 Wheelers and 0.20% to existing Housing Loan Borrowers of IOB. (T&Cs Apply). **1.00% Special Interest Concession to Borrowers with CIC Score of 800 and above. (T&Cs Apply). ***1.00% Special Interest Concession to Borrowers with CIC Score of 800 and above. (T&Cs Apply)."
Bank of India
BOI has mentioned on its website that “The effective RBLR w.e.f 07.12.2022 is 9.10% as per the revised Repo rate (6.25%)." Additionally, Bank of India increased MCLR for all tenures by 25 bps. With effect starting on December 1, 2022, the Bank of India's one-year MCLR is now 8.15% and its six-month MCLR is 7.90%.
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