On Thursday, State Bank of India and Punjab National Bank, the two state-owned banks announced a steep hike in lending rates by up to 20 basis points which will increase the interest rates on existing as well as home, auto loans, and personal loans. This move will make your home and car loans a little expensive.
Punjab National Bank which is the second largest public sector lender increased its one-year MCLR from 8.15% to 8.30%, three-year MCLR from 8.30% to 8.45%, and for five years from 8.45% to 8.60%.
SBI too hiked its two-year MCLR from 8.05% to 8.25% and three-year MCLR from 8.10% to 8.35%. Also, the six-month MCLR has gone up from 7.90% to 8%. Meanwhile, HDFC Bank is expected to review its interest rates next week.
SBI managing director and head of retail and digital banking PK Gupta said that “Given the liquidity situation, some alignment was required and it has been done today. Earlier, the whole market was on a downward cycle but now the feeling is that the risk for inflation is on the upside only. We think that the downward cycle is over and the rate should probably remain stable around the current rates for some time."