New Delhi: Joining the rate cut spree, two public sector lenders, Punjab National Bank and IDBI Bank, Wednesday cut their base rates by 0.25 percent to 10 percent, which will lead to lower EMIs for its customers.
Punjab National Bank (PNB) has revised downwards the base rate or minimum lending rate to 10 percent from 10.25 percent, effective May 7.
However, the new base rate of IDBI Bank would be effective from May 11.
All loans linked to its base rate of both the banks will now come down by at least 0.25 percent.
IDBI Bank has taken this "pro-active step", keeping in view the recent policy measures announced by the RBI, the bank said in a statement.
"The reduction in interest rate is expected to positively impact loan growth; both in the retail consumer segment, as also revitalise fixed capital formation through higher corporate sector lending, thereby supporting the growth impulses in the economy," IDBI Bank said.
The bank has also decided to reduce the retail term deposit rates in select buckets by 0.10-0.25 percent with effect from May 11.
Yesterday, Bank of Baroda, too, had cut base rate by 0.25 percent to 10 percent.
The country's largest lender, SBI, had reduced its base rate by 0.15 percent to 9.85 percent, effective April 10.
Banks such as SBI, ICICI Bank, HDFC Bank and Axis Bank had cut lending rates by up to 0.25 percent after RBI Governor Raghuram Rajan's tough talk with bankers on April 7.
However, many others have not revised their rates yet.
The Reserve Bank had blamed banks for not passing the benefits of two repo rate cuts to borrowers and termed as "non-sense" the lenders' claims that cost of funds is high.
"The banks' marginal cost of funding (has) fallen, the notion that it hasn't fallen, is non-sense. It has fallen," Rajan had said.
