Private sector lender ICICI Bank on Thursday cut its base rate by 0.35 per cent to 9.35 per cent.
The new rate will be applicable from October 5. State-run Dena Bank too reduced its base rate, or minimum lending rate, by 0.30 per cent to 9.70 per cent from 10 per cent earlier.
The new base rate will be applicable from October 5. A number of lenders, including the country's largest State Bank of India , PNB, IDBI Bank, Bank of Baroda, Bank of India and Axis Bank reduced their base rate after RBI on September 29 effected a 50 basis points cut in repo rate.
SBI, ICICI, Andhra Bank and Bank of India were among the first to cut base rate in the range of 0.20-0.40 per cent in response to RBI's surprise action.
The new rate will be applicable from October 5. State-run Dena Bank too reduced its base rate, or minimum lending rate, by 0.30 per cent to 9.70 per cent from 10 per cent earlier.
The new base rate will be applicable from October 5. A number of lenders, including the country's largest State Bank of India , PNB, IDBI Bank, Bank of Baroda, Bank of India and Axis Bank reduced their base rate after RBI on September 29 effected a 50 basis points cut in repo rate.
SBI, ICICI, Andhra Bank and Bank of India were among the first to cut base rate in the range of 0.20-0.40 per cent in response to RBI's surprise action.
Current Base Rate, PLR Rate and Base Rate Cut Trend of All Banks In India
Who sets the base rate? Do banks set their own base rate or is it set by the RBI? What determines a bank’s base rate?
- Each bank decides its base rate from time to time
- The RBI does not mandate or decide the base rate of any bank or NBFC or HFC
- A bank’s base rate or PLR is determined based upon its cost of raising funds or deposits and a minimum margin that it must apply to cover its cost of operations and credit risk. However, a bank can have only one base rate for all its customers at a time
- When pricing a loan, the bank may add customer specific or product specific spread or margin to the base rate to arrive at its lending rate
How does base rate vary over time? How do interest rates on base rate benchmarked loans change over time?
- Banks are free to revise their base rate any number of times.
- In order to avoid too frequent changes to applicable interest rate on base rate benchmarked loans, RBI has specified that interest rate applicable on all such loans be revised at the beginning of every quarter to give effect to changes made to the base rate during the previous quarter
