Indian Bank will raise lending rates by 15-35 basis points throughout the period | Techy Kings

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Public sector bank Indian Bank announced an increase in its marginal cost of funds lending rate (MCLR) by 15-35 basis points across tenors, the bank said on Tuesday.

The benchmark one-year tenor MCLR, which is linked to the majority of consumer loans such as car, auto and personal, will increase from 7.85 per cent to 8.10 per cent.

The minimum lending rate or internal benchmark below which banks are prohibited from lending is known as the Marginal Cost of Funds Lending Rate (MCLR).

The revision will make loans linked to the MCLR benchmark more expensive. One-year rates are used to set most consumer loans such as car, personal and home loans.

Overnight to six-month tenor MCLR was raised in the range of 7.40 to 7.90 percent for Indian Bank.

The overnight MCLR rate will increase from 7.05 percent to 7.40 percent, the one-month rate will increase from 7.25 percent to 7.50 percent. While the 3-month rate will increase from 7.45 percent to 7.65 percent, and the 6-month rate will increase from 7.70 percent to 7.90 percent.

The above revision in the Benchmark Lending Rate is effective from 3 November 2022 until the next revision.

The bank raised MCLR across all tenors in response to the adjustment, and the lending rate hike was in line with the RBI’s 50 basis point hike in the repo rate to 5.9 percent.

Since May this year, the RBI has raised the repo rate by 190 basis points. Increases in repo-related lending rates and MCLR have made borrowing more expensive for consumers.

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