People planning to go for a home or an auto loan just wait and watch.
As per the ENS Economic Bureau, though the Central bank (RBI) of India’s annual monetary policy review is only three weeks away, State Bank of India, the country’s largest bank, has announced a hike in its benchmark lending rates by 25 basis points (bps), making home and auto loans from the lender dearer.
SBI’s benchmark prime lending rate will now rise to 13.25 per cent. The rate hike would be effective from April 25, 2011, the bank said in a statement.
The base rate of India’s largest private sector lender ICICI Bank is 8.75 per cent. The base rate was introduced replacing the Benchmark Prime Lending Rate (BPLR) in July last year to bring in more transparency.
However other financial lenders are waiting till May to get a cue from the annual monetary policy of the RBI.
M Narendra, CMD, Indian Overseas Bank said, “We will wait and watch until the RBI policy before we jump for any decision on these rate issues. On the other hand, I believe that bulk deposit rates are still slightly higher and being a slack season, we do not want to revise the lending rates right now.”
Punjab National Bank’s ED, Mohan Tanksale, said “We have no plan to revise either our base rate which is at 9.5 per cent now or even the BPLR at 13 per cent. I hope credit offtake to be in place before we take any such decision on the rates. We have no plan to revise our deposit rates too.”
“We have no plan to revise either our base rate or even the BPLR. Let the RBI policy come. We have recently moderated our bulk deposit rates and hence we are not looking any further revision in that segment to,” maintained, BA Prabhakar, ED, Bank of India.
The RBI raised its lending and borrowing rates by 25 basis points each to 6.75 per cent and 5.75 per cent respectively in its mid-quarter review in March. The central bank is widely expected to hike key policy rates by at least 25 basis points in its annual monetary policy on May 3.
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