SBI loans get cheaper! Bank passes on 75 bps repo rate cut to customers
Following a 75 basis points reduction in interest rate, SBI's external benchmark linked lending rate (EBR) will come down to 7.05 per cent per annum from 7.80 per cent earlier
- Mar 27, 2020,
- Updated Mar 27, 2020 9:57 PM IST
Hours after the Reserve Bank of India announced 75 basis points cut in repo rates, State Bank of India (SBI) passed on the complete rate cut benefits to its borrowers availing loans linked to external benchmark linked lending rate (EBR) and repo linked lending rate (RLLR).
Following a 75 basis points reduction in interest rate, SBI's external benchmark linked lending rate will come down to 7.05 per cent per annum from 7.80 per cent earlier. Similarly, SBI's linked lending rate will reduce to 6.65 per cent per annum from existing 7.40 per cent.
SBI, the country's largest mortgage lender, was the first bank to link its loan products, including home loans, to an external benchmark. The public sector lender had chosen to use the RBI's repo rate as the benchmark for their home loans. Loan interest rates linked to repo rate are called repo linked lending rates (RLLR); SBI calls it external benchmark rate (EBR).
Besides, SBI has also proposed to realign its interest rate structure on deposits from March 28, 2020, after the central bank announced additional liquidity measures in today's monetary policy statement.
The bank has slashed its retail term deposit interest rates by 20 to 50 bps across tenors, while bulk term deposit interest rates by 50 to 100 bps.
The lender said that decision on marginal cost of funds-based lending rate (MCLR) will be taken during the asset-liability committee (ALCO) meeting on April 20. The impact of the RBI monetary stimulus and reduction in the deposit rates will be reflected in the next review of MCLR.
Hours after the Reserve Bank of India announced 75 basis points cut in repo rates, State Bank of India (SBI) passed on the complete rate cut benefits to its borrowers availing loans linked to external benchmark linked lending rate (EBR) and repo linked lending rate (RLLR).
Following a 75 basis points reduction in interest rate, SBI's external benchmark linked lending rate will come down to 7.05 per cent per annum from 7.80 per cent earlier. Similarly, SBI's linked lending rate will reduce to 6.65 per cent per annum from existing 7.40 per cent.
SBI, the country's largest mortgage lender, was the first bank to link its loan products, including home loans, to an external benchmark. The public sector lender had chosen to use the RBI's repo rate as the benchmark for their home loans. Loan interest rates linked to repo rate are called repo linked lending rates (RLLR); SBI calls it external benchmark rate (EBR).
Besides, SBI has also proposed to realign its interest rate structure on deposits from March 28, 2020, after the central bank announced additional liquidity measures in today's monetary policy statement.
The bank has slashed its retail term deposit interest rates by 20 to 50 bps across tenors, while bulk term deposit interest rates by 50 to 100 bps.
The lender said that decision on marginal cost of funds-based lending rate (MCLR) will be taken during the asset-liability committee (ALCO) meeting on April 20. The impact of the RBI monetary stimulus and reduction in the deposit rates will be reflected in the next review of MCLR.