The public sector lender, Bank of Maharashtra, has slashed its base rate by 25 basis points to 10.25 percent per annum. Earlier, its base rate was 10.50 percent. The bank took the step following the central bank's reduction in key policy rates by 25 bps.
The new base rate will be brought into effect on February 9, 2013. On the matter, the Executive Director of the bank, Mr.C.VR. Rajendran, said, "The 25 bps cut in CRR does not permit us to cut the base rate. However, growth is important and, hence, monetary transmission must take place. The CRR cut will release about Rs 250 crore of liquidity to the bank. While the margins will be affected to the extent of 15 bps."
It should be noted that the Reserve Bank of India reduced its repo rate and cash reserve ratio by 25 basis points in the recent monetary policy review.