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4 PSU banks cut lending rates by up to 0.45%, MCLR loans to become cheaper

The reduction in MCLR is expected to positively impact loan growth

Press Trust of India  |  New Delhi 

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Four public sector lenders, including Indian Bank and Vijaya Bank, today cut their benchmark by up to 0.45 per cent.

Punjab & Sind Bank reduced the overnight marginal cost of based lending rate (MCLR) by 0.45 per cent to 8.15 per cent from 8.60 per cent.

It reduced the one-month by 0.40 per cent to 8.20 per cent, while one-year lending will be cheaper by 0.15 per cent to 8.55 per cent.

Chennai-based Indian Bank reduced the across all segments by 0.15 per cent.

tweaked in two segments, including for one-year tenor which will become cheaper by 0.15 per cent to 8.50 per cent.

IDBI Bank also reduced by 5-10 bps across various tenors.

"The reduction in is expected to positively impact growth, thereby supporting the growth impulses in the economy," the bank said in a statement.

With the reduction in benchmark rates, home, car and other loans linked to would become cheaper.

switched to as their new benchmark lending rate from June last year, replacing the base rate system for new borrowers.

It is calculated on the marginal cost of and return on net worth for It was introduced by to ensure fair to borrowers as well as

also seeks to address the regulator's primary objective of expediting monetary policy transmission along with augmenting uniformity and transparency in the calculation methodology of rates are revised every month.

First Published: Wed, September 06 2017. 23:16 IST