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    SBI to hike prime lending rate by 70 bps to 13.45% from September 15

    SBI to hike prime lending rate by 70 bps to 13.45% from September 15

    SBI to hike prime lending rate by 70 bps to 13.45% from September 15
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    By CNBC-TV18  IST (Published)

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    Shares of State Bank of India ended at Rs 571.60, up by Rs 13.35, or 2.39 percent on the BSE.

    The country's largest lender State Bank of India (SBI) on Wednesday said it will increase the benchmark prime lending rate (BPLR) by 70 bps to 13.45 percent with effect from Thursday (September 15).
    The bank, however, did not change the marginal cost of the funds-based lending rate (MCLR) which would have brought down the cost for all borrowers.
    Banks review MCLR on a monthly basis, while the base rate revision happens once a quarter. At present, banks fix interest rates on loans with reference to BPLR.
    Earlier in August, SBI raised its benchmark lending rates by up to 50 basis points (or 0.5 percent). External Benchmark based Lending Rate (EBLR) and Repo-Linked Lending Rate (RLLR) have been raised by 50 basis points while the hike in Marginal Cost of funds-based Lending Rate (MCLR) is 20 basis points across all tenure.
    SBI's EBLR rose to 8.05 percent and RLLR increased by similar 50 basis points to 7.65 percent. Banks add Credit Risk Premium (CRP) over the EBLR and RLLR while giving any kind of loan, including housing and auto loans.
    With the revision, one-year MCLR has increased to 7.70 percent, from the earlier 7.50 percent, while for two years it rose to 7.90 percent and for three years to 8 percent. Most of the loans are linked to the one-year MCLR rate.
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