Days after the 35 bps repo rate cut by the Reserve Bank of India, state-run lenders Allahabad Bank and UCO Bank on Friday slashed the marginal cost of funds- based lending rate (MCLR) across all tenors. Allahabad Bank said it has reduced its MCLR by 15 to 20 basis points (bps) for different tenors, effective from August 14 while another public sector lender UCO Bank announced that it has cut the same by 15 bps across all tenors.
"The benchmark one-year MCLR has been reduced by 15 bps to 8.5 percent as against 8.65 percent earlier," UCO Bank said in a statement. The one-year MCLR is the rate based on which the retail loans such as home, car and personal advances are linked, the lender said. UCO Bank is planning to link the rate of interest with RBI repo rates, to pass on the benefit to customers.
Allahabad Bank also said it has decided to reduce the rate of interest on retail term deposits by 10 bps across all terms over one year. Allahabad Bank's MD and CEO S.S.Mallikarjuna Rao said the bank will be exploring to develop products of both assets and liabilities linked with an external benchmark to transmit the benefits of the rate cut to its customers shortly.
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