PNB Interest Rates Reduced by 10 Basis Points From March 1
The new move by the PNB would help the seekers attain loans at cheaper rates from March 1, following the RBI directives.
New Delhi, February 28: Recovering from the controversy of lending diamantaires Nirav Modi and Mehul Choksi of Rs 14,356.84 crore, the Punjab National Bank is all set to reduce the interest rate of MCLR by 10 basis point by Thursday evening. The new rate will be effective from March 1, 2019, and is expected to increase the number of lenders for the bank.
Briefing about the information, the Managing Director of Punjab National Bank Sunil Mehta on Wednesday said, “PNB to reduce the interest rate by 10 basis point by today evening. New rate will be effective from 1st of March.” Earlier the Marginal Cost of Fund based Lending Rate – commonly known as MCLR – of PNB is 8.15 to 8.75 percent (as on February 27, 2019). With the decrease in the rate, the new MCLR will become 8.05 to 8.65 percent. Home Loans Set To Get Cheaper as RBI Cuts Repo Rate By 25 BPS to 6.25% in Monetary Policy.
Also, for the one-year tenor loans, against which most of the consumer loans are benchmarked, has been cut to 8.45 per cent from 8.55 per cent. The three-year MCLR has been cut to 8.65 per cent. For the for overnight, one/three/six-month MCLRs, rates have also been down by 10 basis points each at 8.05 per cent, 8.10 per cent and 8.15 per cent respectively. However, the base rate at 9.25 per cent will remain unchanged, the bank said.
MCLR defines internal benchmark rate used by banks to fix the interest rate on floating rate loans. According to the norms prescribed by the RBI of the country, all banks in India are required to benchmark and price their loans to MCLR from 1st April 2016. In its last bi-monthly policy review for 2018-19, the RBI had cut the key repo rate by 25 basis points to 6.25 per cent, paving the way for banks to make consumer loans cheaper.
Though the public bank state that they would decrease their MCLR from March 1, the base rates are still higher than the country’s largest lender SBI. The SBI on February 8 had announced to cut home loan rates by 0.05 percentage point for loans up to Rs 30 lakh, following the RBI’s last bi-monthly policy review for 2018-19 which had reduced the key repo rate by 25 basis points to 6.25 per cent, paving the way for banks to make consumer loans cheaper.
(The above story first appeared on LatestLY on Feb 28, 2019 12:17 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).