State Bank of India Ltd., the country's largest public sector lender, has reduced rates on home loans of up to Rs 30 lakh for salaried borrowers by 25 basis points to 8.35 percent, the bank said in a press release. A basis point is one hundredth of a percentage point.
For loans above Rs 30 lakh and up to Rs 75 lakh, the rate has been reduced by 10 basis points to 8.5 percent, and has been kept unchanged at 8.60 percent for loans above Rs 75 lakh, a spokesperson of the bank told BloombergQuint. The new rates are effective Tuesday.
In January, the bank had reduced rates on home loans of up to Rs 75 lakh by 50 basis points to 8.60 percent for women, and 8.65 percent for men. The reduction coincided with a 90-basis-point cut in SBI's benchmark cost of funds lending rate to 8 percent.
The cut by SBI was then quickly matched by other large players in the market.
“We have seen a steep hike in home loan enquiries recently and reduction in rates will further help millions of home buyers fulfill their dream of owning a home,” the SBI release quoted Managing Director Rajnish Kumar as saying.
Home loans continue to be one of the fastest growing retail loan segments.
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