), HDFC Bank and Kotak Mahindra Bank (KOTAKBANK.NS : 801.85 +26.65) upped interest rates on auto loans. At the same time, home loan major HDFC and ICICI Bank decided it was time to do away with teaser loans, which were being offered at 8.25% for an initial period of two years. Kotak Mahindra Bank went a step further and hiked home loan rates for new customers to 8.5% from its existing 7.99%. "Our decision to increase home loan rate is in lines with the rising interest rate scenario," said KVS Manian, the bank's retail liabilities head. Car loans at Kotak Mahindra will now be costlier by 50-75 basis points and borrowers will have to pay between 10-10.50% as interest.
"Borrowing rates have been firming up since the last credit policy. While we did not pass on the rate hike earlier, we need to do it now," Kotak Mahindra Prime CEO Sumit Bali.
ICICI Bank has raised auto loans rate by 25-50 basis points, which means they will cost between 9.75%-11%, depending on the tenure.
The bank's home loans up to Rs 30 lakh will attract an interest rate of 8.75% while loans between Rs 30 lakh and 50 lakh will be at 9%.
HDFC Bank plans to charge between 25 and 100 basis points more for car loans. "There has been a change in the monetary stance and there could be some shortage of liquidity with the CRR hike and advance tax payments coming up. So it is not surprising that interest rates are going up," said Ashish Parthsarathy, head of treasury, HDFC Bank.
Meanwhile, the country's largest lender, State Bank of India (SBIN.NS : 2047.2 +14.5
), is likely to take a call on whether or not to increase rates at its next assets and liability committee (Alco) meeting. SBI's chief financial officer SS Ranjan said, "Generally, interest rates are moving up and that is possibly the reason some banks have increased lending rates." At IDBI bank (IDBIBANK.NS : 0 0
) though rates may not move up. According to its CFO P Sitaram, while IDBI had marginally increased deposit rates in a couple of buckets in February, the bank has no plans hiking its lending rates as of now. Added Bank of Baroda chairman and managing director MD Mallya, "We are maintaining both our lending and deposits rates for the moment. But the situation is dynamic." HDFC has discontinued its special festival offer on home loans much like ICICI Bank, which too will no longer offer special rates home loans. In February, two public sector and two private sector banks had raised deposit rates following the Reserve Bank's decision to hike the cash reserve ratio by 75 basis points.
No comments:
Post a Comment