SBI, ICICI Cut Home Loan Rate Following RBI's New Mandate

Mumbai: Leading banks SBI and ICICI on Thursday cut their home loan rates by 0.10 percentage point to 9.4 per cent following implementation of a new interest rate calculation regime mandated by RBI. The lending rates of other banks may also fall soon with the Marginal Cost of Funds based Lending Rate (MCLR) system coming into force with effect from April 1. If the banks decide to pass on the latest 0.25 per cent policy rate cut announced by RBI on April 5, the rates for borrowers may go down further. SBI in a statement on Thursday said that it has fixed its home loan interest rate at 9.45 per cent, which is 0.25 percentage point more than its one-year marginal cost of fund-based lending rate of 9.20 per cent. However, women borrower would get the loan 0.20 percentage point above the MCLR at 9.40 per cent, it said. The new rate is applicable from April 1, it said. As per the information available on SBI website, the earlier home loan rate 9.5 per cent for women borrowers and 9.55 per cent for others. As per ICICI's website, the private lender's minimum home loan rates are also at par with its bigger rival SBI as both the 1-year MCLR and the spread over it are same. However ICICI Bank's effective rate of interest will go up to 9.65 per cent for loans above Rs 5 crore taken by women borrowers under floating interest rate. The weaker section borrowers will be able to avail loans of up to Rs 25 lakh at 9.40 per cent. RBI had asked banks to price fixed-rate loans of up to three years based on their marginal cost of funds from April 1. All banks have to follow MCLR system, a new uniform methodology which will ensure fair interest rates to borrowers as well as to banks. SBI said that the reduction in home loan rate has been made possible as it is calculating the lending rate as per the MCLR for one year, which has been set at 9.20 per cent. Its car loan would be available at 0.60 per cent above 1 year MCLR at 9.80 per cent. Student loans of up to Rs 7 lakh would be available at 2 per cent above MCLR, currently 11.20 per cent. While SBI Skill loan will be available 3.90 per cent above MCLR at 13.10 per cent. Besides, other loans like personal loan, loan against securities etc have also been linked to MCLR. The base rate or the minimum lending rate of the bank is 9.3 per cent. SBI also waived and reduced charges on a slew of retail loan products for a limited period, the statement said. According to the ICICI Bank's website, the full tenor fixed rate loans will be sold at 9.75 per cent up to Rs 30 lakh and it will be between 9.85-10.10 per cent for loans above Rs 30 lakh. The lending rates of home finance major HDFC, however, are unchanged at 9.50 per cent for women and 9.55 per cent for other customers, but these can be reviewed with the movement in cost of funds, an official said. HDFC, being a housing finance company, does not follow the MCLR system, the official added. .(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)

SBI, ICICI Cut Home Loan Rate Following RBI's New Mandate

SBI cut home loan interest rate to 9.45 per cent SBI lowered home loan interest rate to 9.4 per cent for women customers The new rates to be applicable from April 1

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