Oriental Bank of Commerce (OBC) on Monday announced the rate cut on vehicle and home loans by up to 1.5%. Bank's existing customers with good credit history will also get an additional concession of 0.25%.
The base rate of the bank has been lowered to 10.50% from 10.65% earlier while BPLR now stands at 14.75% from the earlier 15% mark.
The bank will be offering car loans at 11.5% for 3 year tenor, and 11.75% for longer durations. Previously the lending rates were 12.65% and 13.15% respectively.
A 30 lakh home loan for 15 year duration can be purchased at 10.75%, earlier the same loan would have cost 11.15%. Loyalty bonus for existing customers would bring the rates down to 10.50%, which is the base rate.
"We believe our new home loan scheme will help improve demand for home loans. When economy is in a stress, we want to give a boost to retail assets so that home loan demand goes up in a big way", Mr.S.L. Bansal, Chairman and MD of the bank said.
The state owned lender has also relaxed the repayment period of car and home loans to 7 and 25 respectively. Previously these were 5 years for cars and 20 years for home loans.
By doing so, the bank hopes to raise its retail loan portfolio from 11% to 15% of its total loans.