PNB cuts MCLR rate by 5 basis points

Punjab National Bank reduced its Marginal Cost of Funds-Based Lending Rate (MCLR), benchmark for pricing loans, by five basis points across maturities from August 1, 2016. The revised marginal MCLR for one-year loan will be 9.35 per cent.

Recently introduced MCLR is the new benchmark lending rate which has replaced the base rate for new borrowers. It is calculated on the marginal cost of borrowing and return on net worth for banks. The Reserve Bank has inducted the new rate calculation method to ensure fair interest rates to borrowers as well as banks.