Latest news with #RepoLinkedLending
New Indian Express
12 hours ago
- Business
- New Indian Express
RBI's repo cut: Competition drives rapid loan rate reductions
CHENNAI: Unlike in the past, most leading commercial banks in India have promptly passed on the repo rate cut announced by the Reserve Bank of India (RBI) to their customers, resulting in a much quicker transition. The RBI implemented a 50 basis point (bps) reduction in the repo rate on June 6, lowering it from 6.25% to 5.75%. This move aims to stimulate economic growth by making borrowing more affordable and encouraging investment, particularly in sectors such as housing and micro, small, and medium enterprises (MSMEs). Following the RBI's policy rate cut, the State Bank of India (SBI), the country's largest lender, announced reductions in its lending rates—cutting the Repo Linked Lending Rate (RLLR) by 50 bps to 7.75% and the External Benchmark Based Lending Rate (EBLR) to 8.15%. According to SBI, the revised rates are effective from June 15, 2025, and apply to both new and existing borrowers. SBI's move has influenced other major banks to follow suit. Bank of Maharashtra reduced retail loan rates by up to 50 bps, effective June 10, 2025. HDFC Bank, Canara Bank, and Bank of Baroda also implemented reductions in their Marginal Cost of Funds-Based Lending Rates (MCLR), making loans more affordable for consumers.
Time of India
5 days ago
- Business
- Time of India
Home loan EMIs to fall: Canara Bank, Union Bank, IOB cut lending rates after RBI repo rate cut
Impact of RBI rate cut on home loan borrowers What is RLLR? Academy Empower your mind, elevate your skills Bank Old RLLR Revised RLLR Effective Date Canara Bank 8.75% 8.25% 12-Jun-25 Union Bank of India 8.75%* 8.25% 11-Jun-25 Indian Overseas Bank 8.85% 8.35% 12-Jun-25 Leading public sector banks, such as Canara Bank Union Bank of India , and Indian Overseas Bank have lowered their Repo Linked Lending Rates (RLLR) in response to the Reserve Bank of India 's recent 50 basis point repo rate cut . Home loan borrowers can anticipate some relief in interest rates as a four major public sector banks Punjab National Bank (PNB), Bank of Baroda (BoB), Indian Bank and Bank of India (BOI) had announced reductions in their home loan interest rates RBI's rate actions have a direct impact on home loan interest rates that are linked to the repo rate, or Repo Linked Lending Rates (RLLR). A lower repo rate usually translates into a lower RLLR, which means that consumers will pay less in interest over the course of the loan term and have fewer EMIs (equivalent monthly installments).Repo-linked lending rate (RLLR) is the interest rate at which banks extend loans to customers, based on the repo rate set by RBI. The term 'repo-linked lending rate' refers to an interest rate that is linked to the repo rate. An RBI circular issued in October 2019 mandates that banks link their retail loans to external benchmark lending rates, known as EBLR. Consequently, the repo rate has become the benchmark for most impact of the reduction of RLLR will be different for old and new home loan borrowers. Most of these banks have passed on the reduction benefit to new borrowers immediately. However, old borrowers, who have already have a home loan, will get the benefit as per their corresponding interest rate reset Overseas Bank has announced the reduction of Repo Linked Lending Rate (RLLR) by 50 basis points from 8.85% to 8.35%, effective from June 12, Bank of IndiaThe Union Bank of India has reduced both the External Benchmark Lending Rate (EBLR) and the Repo Linked Lending Rate (RLLR) by 50 basis points, bringing its EBLR down to 8.25% (comprising the new repo rate of 5.50% plus a spread of 2.75%).According to a press release from the bank, 'Following the Reserve Bank of India's reduction in the policy repo rate by 50 basis points, Union Bank of India has revised its key lending rates w.e.f. 11.06.2025. These changes include downward revision of External Benchmark Lending Rate (EBLR) and Repo Linked Lending Rate (RLLR) by 50 basis points. With this move, Union Bank of India has completely aligned its EBLR and RLLR with the recent RBI rate cut which will be beneficial to new and existing Retail (Home, Vehicle, Personal, etc.) and MSME borrowers.'Canara Bank has reduced its Repo Linked Lending Rate (RLLR) from 8.75% to 8.25% for loans tied to the External Benchmark rate. This decision follows the Reserve Bank of India's recent 50 basis point cut in the repo rate from 6.00% to 5.50%, announced during the latest Monetary Policy Committee (MPC) meeting. The revised lending rate will come into effect from June 12, 2025. This move will lower borrowing costs for customers with loans linked to RLLR.
India.com
5 days ago
- Business
- India.com
Canara Bank, Union Bank, IOB Slash Home Loan Rates --Check Latest Lending Rates
New Delhi: Canara Bank, Union Bank and Indian Overseas Bank (IOB) have announced reduction in their lending rates following the Reserve Bank of India's (RBI) announcement cutting the repo rate by 50 basis points, from 6.00% to 5.50%, in the latest Monetary Policy Committee (MPC) meeting. Canara bank has reduced Repo Linked Lending Rate (RLLR) from 8.75 % to 8.25 % (applicable on its assets portfolio linked to External Benchmark rate). The revised lending rates will be effective from 12 June 2025, said Canara Bank. "The RLLR has been reduced by 0.50% (50 basis points), directly reflecting the decrease in the RBI's repo rate. This move will lower borrowing costs for customers with loans linked to RLLR. Depending on their loan terms, customers may benefit from reduced EMIs (Equated Monthly Instalments) or a shorter loan tenure. Canara Bank, with a commitment to provide better banking experience to its customers, has offered the due benefits to borrowers by reducing RLLR," the bank said in a statement. Union Bank and Indian Overseas Bank Hhave also announced a downward revision of External Benchmark Lending Rate (EBLR) and Repo Linked Lending Rate (RLLR) by 50 basis points.
Time of India
15-05-2025
- Business
- Time of India
Has SBI lowered its home loan lending rates again? Check latest rates for May 2025
Latest SBI External Benchmark Rate (EBR) for home loans, car loans, other loans Live Events Latest SBI home loan rates for borrowers Latest SBI RLLR for home loan borrowers Latest SBI MCLR in May 2025 Tenor Existing MCLR (In %) Revised MCLR (In %)* Over night 8.2 8.2 One Month 8.2 8.2 Three Month 8.55 8.55 Six Month 8.9 8.9 One Year 9 9 Two Years 9.05 9.05 Three Years 9.1 9.1 The State Bank of India (SBI), the country's largest public sector lender, has kept its key lending rates unchanged for May 2025, maintaining stability across both its Marginal Cost of Funds Based Lending Rate (MCLR) and external benchmark-linked rates such as Repo Linked Lending Rate (RLLR). This pause in the home loan and other loan interest rates has come after a 0.25% rate cut in April 2025. The rate cut in loan interest rate was implemented after the Reserve Bank of India (RBI) reduced the repo rate by 25 basis points at its April monetary policy meeting April 2025, following the RBI's 25-basis-point cut in the repo rate, SBI reduced its key lending rates for external benchmark-linked loans by up to 0.25%, aligning with the central bank's monetary easing effect from April 15, 2025, the External Benchmark Rate (EBR) of SBI is 8.65%. The EBR is the rate at which banks determine the interest rates for various floating rate loans, including home EBR made up of two parts:RBI Repo Rate: 6.00%Spread (fixed by the bank): 2.65%Final EBR = Repo Rate + Spread = 6.00% + 2.65% = 8.65%The External Benchmark Rate (EBLR) of SBI is linked to the RBI's Repo Rate, with an added Credit Risk Premium (CRP) and Business Strategy Premium (BSP) based on the customer's credit profile and loan product. The latest EBLR 8.65% with effect from April 15, 2025. So, the applicable home loan interest rate for borrower is Repo rate + Spread (Credit Risk Premium + Business Strategy Premium) which is 6% + 2.65% = 8.65%.The RLLR is also tied to the RBI Repo Rate with an additional Credit Risk Premium (CRP). The base RLLR is 8.25% which includes credit risk premium. This rate is effective from April 15, 2025. The credit risk premium is 2.25% over and above repo rate of 6%.SBI's Marginal Cost of Funds Based Lending Rate (MCLR) remains unchanged in May 2025. The overnight and one-month MCLR are both at 8.20%, while the three-month rate is 8.55% and the six-month rate is 8.90%. The one-year MCLR is 9.00%, with the two-year and three-year rates at 9.05% and 9.10% SBI websiteThe MCLR is a benchmark rate used by banks to determine interest rates on various floating-rate loans, including home loans, personal loans, and auto loans. A decrease in MCLR translates to a potential drop in equated monthly installments (EMIs) of loans or a shorter loan tenure, benefiting borrowers in the long term. However, banks have moved from MCLR based regime to external benchmark regime from October 1, 2019. Hence, most banks are not issuing loans linked to MCLR based home loan interest rate varies from 8% to 8.95% based on the CIBIL score of the loan borrower. SBI Home loan Maxgain OD interest rate varies between 8.25% and 9.15%. For a top up loan, the interest rate varies between 8.30% and 10.80%. These rates are effective from April 15, 2025.
