Despite RBI pause, banks lower MCLR; SBI reduces by 10 bps, HDFC Bank by 15 bps

'To pass on the benefit of our falling cost of funds to customers, we have reduced MCLR by 10 bps across one-year maturity,' a statement from SBI said. HDFC Bank, the country's largest private sector bank, cut its MCLR on loans for all tenors by up to 15 bps. Last month, HDFC Bank cut its MCLR across tenors by up to 10 bps. According to the bank's website, the latest interest rate cut will be effective from December 7, 2019. After the latest cut, the six-month MCLR will stand at 8 per cent, down 10 bps, one-year will be at 8.15 per cent (a cut of 15 bps), two-year rate will be at 8.25 per cent (a cut of 15 bps) and the three-year rate will be at 8.35 per cent (down 15 bps). Meanwhile, Bank of India too revised its one-year MCLR-based lending rates by up to 20 bps across various tenors, effective Tuesday. The state-owned lender has reduced its MCLR for overnight rates by 20 bps while for other tenors the cut is 10 basis points, a PTI report quoted a statement by the bank as saying. It added that the overnight rates will stand at 7.75 per cent. Other banks are also expected to reduce the MCLR in the coming days, bankers said. 'The quantum of the reduction will depend on the asset-liability factor,' said an analyst. If the loan is linked to the MCLR rate, the latest cut may not bring down the EMIs immediately as MCLR-based loans typically have a one-year reset clause. For new borrowers, SBI also offers a repo-rate linked home loan scheme. Under the repo-linked system, interest rates change when the RBI revises the benchmark repo rate. During the monetary policy press briefing on December 5, RBI Governor Shaktikanta Das said that although it is not in a hurry to keep reducing interest rates, the central bank would work to ensure that transmission turns more effective since much needs to be passed on. While the RBI had cut repo rates by 135 bps in five policy reviews in 2019, the one-year median MCLR has declined by only 49 bps. The weighted average lending rate (WALR) on fresh rupee loans sanctioned by banks declined by only 44 bps. DailyhuntDisclaimer: This story is auto-aggregated by a computer program and has not been created or edited by Dailyhunt. Publisher: The Indian Expresshttps://www.edocr.com/user/jeffmattyhardayhappy

https://www.aeriagames.com/user/jumenshenses/