SBI Raises Benchmark Prime Lending Rate By 0.7 Per Cent To 13.45 Per Cent
This move by SBI will make loan repayment linked to BPLR costlier. The current BPLR rate is 12.75 per cent. It was revised last in June
State Bank of India (SBI), the country’s largest public sector lender, has raised the Benchmark Prime Lending Rate (BPLR) by 70 basis points (or 0.7 per cent) to 13.45 per cent. This move will make loan repayment linked to BPLR costlier. The current BPLR rate is 12.75 per cent. It was revised last in June.
According to SBI website, “Benchmark Prime Lending Rate (BPLR) revised as 13.45 per cent per annum with effect from September 15, 2022.”
The bank has also raised the base rate by similar basis points to 8.7 per cent, effective Thursday. The EMI amount for the borrowers who have taken loans at the base rate would go up.
These are the old benchmarks on which banks used to disburse loans. Now most of the banks provide loans on the External Benchmark Based Lending Rate (EBLR) or the Repo-Linked Lending Rate (RLLR).
The bank revises both the BPLR and the base rate on a quarterly basis. The lending rate revision by the SBI is likely to be followed by other banks in the days to come.
The increase in the benchmark lending rates comes weeks ahead of the Reserve Bank of India's (RBI) monetary policy meeting, which is again expected to hike rates to contain surging inflation. According to the schedule, the next three-day monetary policy meeting will be held from September 28 to September 30.
The government on Monday released retail inflation data which snapped a three-month downward trend in August by inching marginally to 7 per cent, mainly because of higher food prices.
This is above the central bank’s comfort zone of 6 per cent for the eighth month in a row. Inflation in food basket was 7.62 per cent in August, up from 6.69 per cent in July and 3.11 per cent in August 2021.
Meanwhile, SBI on Wednesday hit the Rs 5-lakh crore market capitalisation on Wednesday after its shares touched a record high of Rs 564.45. SBI has become the third lender in the country to cross the market cap of Rs 5 lakh crore.
With this market capitalisation, SBI stood on the seventh position in the market capitalisation ranking. HDFC Bank held first rank in this list, which was followed by ICICI Bank.
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