SBI, ICICI Bank, Corporation Bank cut MCLR by up to 15 bp - from 9.05 % to 8.90% with effect from November 01,2016

Ample liquidity in the banking system has prompted State Bank of India, ICICI Bank and Corporation Bank to pare their Marginal Cost of Funds based Lending Rate (MCLR) by up to 15 basis points. 

India’s largest bank, State Bank of India, said its one-year MCLR will be 8.90 % with effect from November 01,2016

 Currently, its MCLR is 9.05%

All rupee loans sanctioned and credit limits renewed with effect from April 1, 2016 are priced with reference to the MCLR. 

The MCLR system was introduced in order to improve the efficiency of monetary policy transmission. 

Banks review and publish their MCLR of different maturities every month on a pre-announced date with the approval of the Board or any other committee to which powers have been delegated

SBI also cut its retail term deposit rates (of up to Rs. 1 crore) across various maturities by 10-50 basis points. With effect from November 1 the maximum interest rate the bank will offer is 7.10 per cent (currently 7.25 per cent) on deposits of 456 days to less than two years duration.

The bank said senior citizens will earn 50 basis points above the card rate with effect from November 1instead of 25 basis points now. One basis point is equal to one-hundredth of a percentage point.

ICICI Bank’s new one-year MCLR will be 8.95 per cent with effect from November 1 as against 9.05 per cent now. Last month, India’s largest private sector bank reduced its MCLR by 5 basis points.

Corporation Bank announced that it new one-year MCLR will be 9.45 per cent with effect from November 1 as against 9.50 per cent now.