MUMBAI, July 1:The second largest private sector
lender ICICI Bank has cut its lending rates by 0.10 percent
which will make all the loans cheaper, sources said Monday.
The move comes weeks after it cut its deposit rates
and amid calls for banks to quickly pass on the benefits of
rate cuts by the RBI, which stands at a full 75 bps since
February.
The bank has cut its marginal cost of funds based
lending rate (MCLR)across all tenors by 0.10 percent, they
said adding the new rates areeffective immediately.
The one-year MCLR, to which a majority of loans like
residential mortgages and auto loans are tied, now stands at
8.65 percent, they said.
Top private sector lenders, including ICICI Bank, Axis
Bank and HDFC Bank had initiated deposit cuts between 0.10 and
0.25 percent in the middle of June across select buckets.
It remains to be seen if other banks have also
followed suit by announcing reductions in their rates.
At the June 6 review, the Reserve Bank had said banks
have cut rates by a measly 0.21 percent as against the 0.50
percent cut in key rates, and had asked banks to do more.
The same day, it cut the key policy rate by another
0.25 percent and also hinted at further easing by shifting its
stance to accommodatory from neutral, taking the total quantum
of rate cut to 0.75 percent in 2019.
The RBI initiated the rate action with an eye to prop
up the sagging growth amidst a sustained period of inflation
trending below the 4 percent set for the central bank as part
of the medium-term inflation targeting framework. (PTI)
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