The state owned Bank of Baroda cuts the lending rate by 10 basis points. The rate cut would enable the borrowers to take loan at lower lending rate, making home and Auto loans cheaper for the next one year.
In a regulatory filing the Bank said that the new lending rates will be effective from March 3. The Marginal Cost of Funds Based Lending Rate (MCLR) for overnight and one-month tenors would be 8.25%and 8.30%, respectively, it said in the regulatory filing.
The MCLR for one-year tenor was slashed to 8.65% from 8.75%. The rate cut is seen as a aftermath of cut in repo rate by Reserve Bank of India (RBI). Last month it slashed the key lending rate by 25 basis points pegging the repo-rate at 6.25% keeping in view the benign inflation.
Since the rate cut by RBI banks have been showing reluctance in passing on benefits to the borrowers citing rising NPA. Now this slash in rate by BoB is a welcome move.