India’s largest lender, the State Bank of India, raised its lending rates by 0.20 percentage points (20 basis points) to 8.15 percent, with immediate effect, setting the tone for the industry to follow suit on 1 March.
This is the first lending revision by the bank since April 2016 and comes a day after it massively raised the retail and bulk deposit rates.
Prior to this, the one year-MCLR (marginal cost of funds based lending rate), on which most of the lending is based now, was at 7.95 percent.
The six-month MCLR has been raised by 10 basis points to 8 percent, while the three-year loan pricing goes up by 25 basis points to 8.35 percent.
For the third consecutive time since November, the bank on 28 February 2018 raised its retail and bulk term deposit rates for various maturities by up to 75 basis points.
For retail deposits below Rs 1 crore, the rate has been increased by up to 0.50 percent, while for deposits maturing in one year to less than two years, have been hiked by 0.15 percent to 6.40 percent.
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