State Bank of India (SBI) has cut is benchmark lending rate by 0.05 per cent across maturities, effective from Wednesday, according to an announcement by the state-run lender. As per a notification, country's largest bank lowered the rates from 8 percent to 7.95 percent to be effective from Wednesday. MCLR for overnight will be at 7.70 per cent, one-month tenure 7.80 per cent and three-month tenure at 7.85 per cent. The major change was been made with respect to savings accounts in metro cities, where SBI account holders will now have to maintain a monthly average balance (MAB) of Rs 3,000, instead of Rs 5,000.
The RBI previous year unveiled the MCLR, which sought to remove much of the discretion commercial banks have to set lending rates. However, the pace of lending rate cuts by banks has lagged the reduction in RBI's policy rates.
While an RBI panel has submitted its report on new benchmark in place of MCLR, the RBI is yet to take a call on its recommendations.
Man arrested for making 'abusive' Facebook comment on Modi
The Srivilliputhur town police arrested Thirumurugan (19), an engineering diploma holder based on the complaint from Marimuthu, BJP, Virudhunagar district secretary.
Meanwhile, just few hours of SBI's revision, two more banks namely Karnataka Bank and Allahabad Bank followed the suit by trimming down their MCLR by 10 basis points and 15 basis points respectively.
The move by the SBI will trigger rate cut by other lenders.
Earlier, an RBI study group today suggested banks should switchover to a new interest rate calculation regime from the existing MCLR system.
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