SBI, PNB, HDFC raise loan rates: check the impact on home loan interest rate, EMI

State Bank of India (SBI), Punjab National Bank (PNB) and Housing Development Finance Corp Ltd (HDFC) have increased their lending rates. This preceded the next meeting of the Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI), scheduled for June 6-8.

The RBI, in its first rate move in two years and its first hike in almost four years, raised the repo rate by 40 basis points to 4.40% following an off-cycle meeting in May.

SBI HOUSING LOAN INTEREST RATES

The SBI raised the external benchmark lending rate (EBLR) by 40 basis points to 7.05% plus the credit risk premium (CRP). The country’s largest lender also raised the repo rate-linked lending rate (RLLR) to 6.65% plus CRP.

This means that borrowers have to pay higher interest rates.

New rates are applicable from June 1st.

GNP HOUSING LOAN INTEREST RATES

State-owned PNB raised its marginal cost of funds-based lending rate by 15 basis points or 0.15% for all mandates, a move that will lead to higher EMIs for borrowers.

The new rates take effect June 1, PNB said in a regulatory filing.

With the revision, the one-year MCLR rose to 7.40% from 7.25% previously.

Most loans are tied to the one-year MCLR rate.

The overnight, one-month and three-month MCLR increased by 15 basis points to 6.75%, 6.80% and 6.90%, respectively, while the six-month MCLR increased to 7 .10%.

At the same time, the three-year MCLR increased by 0.15% to reach 7.70%.

With the increase, EMIs will increase for borrowers who benefited from loans on MCLR (marginal cost of funds based lending rate).

HDFC HOME LOAN INTEREST RATES

HDFC increased the retail prime rate (RPLR) by 5 basis points (bps). This is the third increase in a month.

RPLR is considered 5 bps. With this increase, home borrowers with a credit score of more than 780 points will have to pay 7.05%, down from 7%.

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Bernadine J. Perkins