SBI passes on entire 75 bps rate cut to borrowers

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SBI passes on entire 75 bps rate cut to borrowers

SBI passes on entire 75 bps rate cut to borrowers

IANS   ¦    Mar 28, 2020 01:43:13 PM (IST)

SBI passes on entire 75 bps rate cut to borrowers-1New Delhi: In a major relief for its customers, the State Bank of India (SBI) on Friday said that it would pass on the entire 75 basis point rate cut to its retail borrowers.

In a statement, the bank said that the new rates will come into effect from April 1. The borrowers availing loans based on the external benchmark-linked lending rate (EBR) and repo-linked lending rate (RLLR) would be eligible for lower rates.

"Responding to RBI's extraordinary monetary policy measures to support the wider economy, SBI passes on the entire 75 bps Repo rate cut to its borrowers availing loans linked to External Benchmark linked lending rate (EBR) as well as Repo Linked Lending rate (RLLR)," it said.

The SBI has reduced the external benchmark-linked lending rate to 7.05 per cent per annum from 7.80 per cent, and the repo-linked lending rate to 6.65 per cent per annum from 7.40 per annum.

Consequently, EMIs on eligible Home Loan accounts (linked to EBR or RLLR) would get cheaper by around Rs 52 per 1 lakh on a 30-year loan.

Further, in view of adequate liquidity in the system and the additional liquidity measures announced by the RBI on Friday, the SBI said that it would realign its interest rate structure on deposits with effect from March 28, 2020.

The bank reduced its retail term deposit interest rates by 20 bps to 50bps across tenors and bulk term deposit interest rates by 50 bps to 100 bps across tenors.

"Decision on MCLR will be taken when the ALCO meets in April'20. The impact of recent RBI policy measures and reduction in the Bank's deposit rates will be reflected in the next review of MCLR," said the statement.

In a bid to mitigate the impact of the coronavirus pandemic on the India economy, RBI Governor Shaktikanta Das on Friday announced a 75 bps cut in repo rate to 4.4 per cent.