State Bank of India hikes prime lending rate, deposit rates

August 12th, 2008 - 2:07 pm ICT by IANS  

Mumbai, Aug 12 (IANS) India’s largest bank the State Bank of India has become the latest among state-owned banks to announce a hike in its benchmark prime lending rate as also hikes in its deposit rates. The bank’s prime lending rate (PLR) will go up by 100 basis points to 13.75 percent from 12.75 percent with effect from Tuesday, the bank said in a statement.

The deposit rates will be hiked by 25-75 basis points across various slabs effective Aug 16, the statement said.

The hikes follow an increase in the rate at which the country’s central bank, the Reserve Bank of India lends to banks - the repo rate - announced July 29, 2008 in the RBI’s quarterly review of monetary policy.

The RBI had also announced in the review a hike in the cash reserve ratio - the money that banks must hold as reserves and cannot lend.

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