Bank of Baroda and HDFC Bank Reduce Lending Rates
Public sector Bank of Baroda (BoB) announced on June 8 that it has cut its key lending rate linked to the repo rate by 0.50%, in line with the Reserve Bank of India’s (RBI) reduction in policy rates. This move brings BoB’s Repo Linked Lending Rate (RLLR) down to 8.15% effective June 7.
BoB stated that it has fully passed on the benefit of the RBI's repo rate cut to its borrowers. This reduction is expected to make borrowing more affordable and is part of a broader strategy to increase liquidity and stimulate economic activity.
Meanwhile, private sector HDFC Bank has also reduced its Marginal Cost of Funds based Lending Rate (MCLR) by 0.10% across various tenures. According to the bank’s website, the new rates are effective from June 7.
- Overnight and one-month MCLR reduced to 8.90%
- Three-month MCLR reduced to 8.95%
- Six-month and one-year MCLR now at 9.05%
- Two-year and three-year MCLR brought down from 9.20%
These reductions come after the RBI unexpectedly slashed the repo rate and the Cash Reserve Ratio (CRR), aiming to make more funds available for lending and boost the overall economic environment.