Lending rates decline in Nov while deposit rates harden: RBI data

The weighted average lending rates on both fresh and outstanding rupee loans of banks have fallen in November as compared to October, the latest data released by the Reserve Bank of India showed. However, weighted average fixed deposit rates have inched up, indicating deposit re-pricing is still underway.
 

The weighted average lending rate (WALR) on fresh rupee loans of scheduled commercial banks (SCBs) stood at 9.34 per cent in November 2023 as compared to 9.50 per cent in October 2023. It was 9.38 per cent in September. 
 

The WALR on outstanding rupee loans of SCBs was at 9.80 per cent in November 2023 as against 9.84 per cent in October 2023 and 9.83 per cent in September. At the same time, the 1-Year median Marginal Cost of Funds Based Lending Rate (MCLR) of SCBs moved to 8.75 per cent in December 2023 from 8.70 per cent in November 2023.

 

The share of External Benchmark Based Lending Rate (EBLR) linked loans in total outstanding floating rate rupee loans of SCBs was 53.3 per cent at the end of September 2023, while that of MCLR linked loans was 41.9 per cent, the data showed.
 

The weighted average rate for fresh and outstanding rupee deposits hardened in November.
 

The weighted average domestic term deposit rate (WADTDR) on fresh rupee term deposits of SCBs moved to 6.34 per cent in November 2023 from 6.31 per cent in October 2023, and for outstanding rupee term deposits, it stood at 6.78 per cent in November 2023 as against 6.75 per cent in October 2023.
 

The RBI had cautioned banks that as the rate cycle turns, net interest margins, as well as profitability, will come under pressure.

The fall in the lending rate comes even though the central bank has kept the policy repo rate unchanged since April this year.