The lender has also reduced the new one-year marginal cost of funds-based lending rate (MCLR) to nine percent, said the bank in its official communiqué. Most of the loan pricing is based on MCLR.
The modified six month and two-year MCLR now stands at 8.60 percent and 9.25 percent, respectively.
The bank has also slashed its one-month lending rate by 10 basis points to 8.15 percent.
Earlier this week, the country’s largest lender State Bank of India dropped its lending rate by five basis points across all tenors. Its new one-year MCLR is now 8.50 percent.
Similarly, Indian Overseas Bank and Bank of Maharashtra also slashed their lending rates by five basis points.
In response to the 25 basis point repo rate cut by the Reserve Bank of India in its first bi-monthly monetary policy review announced on April 4, lenders have started reducing MCLR.