HDFC Bank cuts base rate by 10 bps to 9.6%

HDFC Bank cuts base rate by 10 bps to 9.6%Taking a lead over rival lenders, HDFC Bank on Thursday announced its decision to cut its minimum lending rate (base rate) by 10 basis points (bps) to 9.6 per cent.

Effective from Saturday, HDFC Bank’s new base rate is below that of public sector lender State Bank of India (SBI) as well as private sector lender ICICI Bank.

HDFC Bank became the lender in the country’s to cut its minimum lending rate after the Reserve Bank of India (RBI) slashed its repo rate by 25 bps on 19th of March.

The country’s second largest private sector lender also brought its benchmark prime lending rate (BPLR) down by 10 basis points to 18.10 per cent.

However, HDFC Bank cut its minimum lending rate by a much smaller magnitude as compared with the reduction made by the central bank in its repo rate and cash reserve ratio (CRR). The central bank slashed the repo rate by
100 bps and the CRR by 75 bps.

SBI’s minimum lending rate is at 9.7 per cent – the lowest among public sector lenders. In the private sector, ICICI Bank’s and Axis Bank’s minimum lending rate is 9.75 per cent and 10 per cent, respectively.

Since the start of this fiscal year, HDFC Bank has decreased its base rate by 40 bps; while ICICI Bank and SBI have cut their respective base rates by 25 bps and 30 bps, respectively. Axis Bank hasn’t made any change in its base rate so far this fiscal year.