Financials India

SBI cuts home loans rates for above Rs 75 lac

SBI cuts home loans rates for above Rs 75 lac

New Delhi: State Bank of India (SBI) on Friday cut its lending rate for home loans above Rs 75 lac, which will effect from June 15, 2017, by 10 basis points (0.10 per cent).

According to the TOI report, the revised interest rates will be 8.55 per annum for salaried women borrowers, while for others the rate of interest will be 8.60 per cent per annum.

“Considering the importance of the housing sector and given its forward and backward linkages to the economy, it has been decided as a countercyclical measure, to reduce the risk weight on certain categories. It has also been decided to reduce the standard asset provisioning on such loans,” the RBI had said on Wednesday after announcing its monetary policy.

SBI usually leads the interest rate cycle in India as far as commercial banks are concerned, with other public and private sector banks following suit.

SBI Chairperson, Arundhati Bhattacharya while speaking of loans over Rs. 30 lac on Wednesday had said:”The decision to reduce the risk weights for home loans over Rs. 30 lac category will release capital for the banking industry and is a positive move.”

SBI had cut rates on home loans of up to Rs 30 lac by 25 basis points (0.25 percent) last month from 8.60% to 8.35% for new borrowers in a bid to cash in on the demand generated by the centre for affordable housing.