ING Vysya Bank raises base rate by 50 bps

Private sector lender ING Vysya Bank today increased its base rate or minimum lending rate by 50 basis points in response to hefty rate revision by the RBI.

The revised rate will be 10.20% against the current rate of 9.70%, ING Vysya Bank said in a statement.

With the increase, all new and existing loans, including home, auto for individuals and those for the corporates would become expensive by at least 50 basis points.

The revised rate shall apply to all existing loans to base rate from August 1, 2011, it said.

It is to be noted that more banks are likely to announce interest rate hike in the next few days as cost of funds has raised following increase in key lending rates by the central bank.

Yesterday, the RBI raised the short-term lending (repo) rate by 50 basis points to 8% and the short-term borrowing (reverse repo) rate to 7% in a bid to tame inflation.

Subsequently, the interest rate under the Marginal Standing Facility, an additional borrowing window, has gone up to 9% from the earlier level of 8.5%.

Soon after RBI announcing quarterly review of monetary policy YES Bank raised rate by 50 basis points to 10.25% and also increased the rate on loans taken under the older BPLR system by 50 basis points.