SBI hikes lending rates by 0.20 percent

The country's largest lender State Bank of India (SBI) Wednesday said it has decided to raise lending rates by 0.20 percent that will make home, auto and other loans costlier.

SBI will raise base rate or the lowest rate at which the bank lends to 10 percent from the existing 9.8 percent.

The bank has also decided to hike Benchmark Prime Lending rate by 0.20 percent to 14.75 percent per annum from the existing 14,55 percent.

The new rates will be applicable from Thursday, SBI said in a statement.

The country's largest lender has announced the hike in lending rates just a week after the Reserve Bank of India hiked its key policy rate.

In its second quarter review of the monetary policy for 2013-14, announced Oct 29, the RBI hiked repo rate by 25 basis points or 0.25 percent to 7.75 percent. Repurchase or repo rate is the rate of interest that banks pay when they borrow money from the central bank to meet their short-term funds requirement.

Some other lenders have also revised their rates upward following the RBI action.

HDFC Bank has raised its base rate by 0.20 percent to 10 percent.

Allahabad Bank earlier this week hiked interest rates on domestic term deposits by upto 1.2 percent per annum on amount less than Rs.1 crore.