If you are a customer of country’s largest State Bank of India (SBI), this news is for you. In fact, SBI has increased the marginal cost of funds based lending rate (MCLR) rate by 10 basis points (0.1%) for various tenures. After this hike, MCLR based loans will become more expensive and EMIs will also be higher than before.
How much increased
With this increase, the one-year MCLR has increased from 8.65% to 8.75%. At the same time, one-month and three-month MCLR has increased to 8.30% from 8.20%. The six-month MCLR has now increased to 8.65% from 8.55%. Additionally, the two-year MCLR has been increased from 8.75% to 8.85%. Similarly, the three-year MCLR has now increased to 8.95% from 8.85%. Let us tell you that most of the retail loans including home and auto loans are linked to one year MCLR rate.
Let us tell you that the MCLR hike will not have any impact on lenders with loans linked to external benchmarks like RBI’s repo rate or treasury bill yield. From October 2019, banks including SBI need to link new loans to this external benchmark to improve the transmission of monetary policy.
Meanwhile, SBI on Friday said it has raised US$ 100 million (about Rs 830 crore) through bonds to expand its business. The amount has been raised through senior unsecured floating rate debentures, SBI said in a stock market filing. Its maturity is three years. SBI said the bonds will be issued by its London branch till June 20, 2024.