HDFC Bank to cut base lending rate by 15 bps

New rate at 9.85%; move follows similar rate cut by SBI

HDFC Bank Ltd, the country's second-biggest private sector lender by assets, will reduce its base lending rate by 15 basis points to 9.85 percent, effective April 13, an executive at the bank said on Tuesday.

The Reserve Bank of India (RBI) proposed earlier in the day that banks should decide lending rates based on their marginal cost of funding, hoping the shift will persuade them to lower lending rates faster in response to central bank easing measures.

Senior executives at India's top lender, the State Bank of India, told Reuters earlier today the bank would cut its base lending rate by 15 basis points to 9.85 percent, effective Friday.