NEWS & ADVICE : FIXED DEPOSITS
HDFC Bank, Union Bank of India reduce their PLRs
By Neelima Shankar
Dec 10, 2008
Print    Email    RSS   

Taking signals from RBI's cut in key policy rates, banks are on track of reducing their lending rates. Following this private lender, HDFC Bank and state-run, Union Bank of India have declined their benchmark prime lending rate (BPLR) to 16% and 12.5% respectively.

While HDFC Bank has reduced its PLR by 50 basis points, Union Bank has effected a 75 basis points reduction in its PLR.

The reduction in case of HDFC would come under two stages of 25 basis points each from December 15th and January 1st. The revised PLR of Union Bank would be effective from December 8th.

Union Bank which has cut the PLR from 13.25% to 12.5% said that the bank has implemented the reduction "in order to ensure credit to productive sectors at lower rates for sustaining growth momentum."

In a press release on Monday, bank stated that the PLR cut would be valid for both new as well as existing customers of the bank. All the portfolios connected to PLR will notice the cut.

Earlier also the bank had cut its PLR by 75 basis points to 13.25%.

HDFC attribute the PLR cut to the falling cost of its funds. Executive Director of HDFC Bank, Paresh Sukthankar said, "The drop in the BPLR is pursuant to the reduction in the bank's incremental cost of funds."

On Saturday, RBI cut both repo rate and reverse repo rate by 100 basis points each to 6.5% and 5% respectively. This step was taken to further ease the liquidity conditions and boost growth in the economy.

As soon as the RBI had declared the cuts in short-term key policy rates, new-age private lender, YES Bank has announced a 50 basis points cut in its PLR.

The banking sources said that other banks are also going to reduce the rates soon. The asset liability committee (ALCO) of other banks, including the country's largest lender SBI, is meeting this week to cut down the rates.

A senior official from SBI said, "Our bank's ALCO will be meeting on Wednesday to take a call on the interest rates."

 


(Comments Posted : 0) Post Your Comments
Show All Comments
COMPARE QUICKLY
 Select a product:
 

CALCULATE QUICKLY
 Select a product:
 

EDITORS' PICKS
Regular fixed deposits in India: Great way...
FDs or Equity? Which suits you best?
Carnival of Indian Personal Finance Blogs #2
Some Quick Facts about Wealth Tax in India!
The new avatar of savings account would...


Sakeela.CaℒL Giℛℒs In Kharar 0985566O911...
NANGAL: CaℒL Giℛℒ In Una 09855660911 Escoℛt...
Chandigarh@CaℒL Giℛℒ In Rajpura +O9855660911...

NEWS THIS WEEK
Federal Bank launched V connect for its customers Feb 12, 2015
Andhra Bank on expansion mode Feb 11, 2015
Dena Bank earned a profit of 13%. Feb 9, 2015
Banks expected to cut down the rates Feb 5, 2015
RBI kept the rates unchanged Feb 4, 2015
News Archive