The Hindu Business Line : Bank of Baroda hikes lending rates by 75 bps

New Delhi, Aug 9 Bank of Baroda, a public sector bank, has hiked its benchmark prime lending rate (PLR) by 75 basis points from 13.25 per cent to 14 per cent. The revised rate would be effective from August 11, the Chairman and Managing Director, Mr M.D. Mallya, has said.

This move would however not impact borrowers of home loans up to Rs 30 lakh as the bank has decided to keep the effective rates unchanged for this category of customers. “The spreads will undergo a change. But the effective rate for those with home loan up to Rs 30 lakh would not undergo change. There is no increase in rates of home loans up to Rs 30 lakh,” Mr Mallya told Business Line.

For home loans of above Rs 30 lakh, BOB has hiked home loan rates by 50 basis points. Mr Mallya further said that the bank was not looking at any increase in deposit rates for now.

Asked as to how the PLR hike would impact net interest margins, Mr Mallya said that it would be difficult to take a call on this as number of cost side issues were involved. “But I am confident that we can sustain the net interest margin of 2.76 per cent achieved in the first quarter for the entire year,” he said.

Mr Mallya also made it clear that the bank has not increased the interest rates on loans for purchase of vehicles.

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