HDFC Bank hikes MCLR rates by 20 bps — check latest interest rates

Last week, another private sector lender ICICI Bank raised its one-year MCLR by 20 bps to 7.75% for July from 7.55% a month ago.

Private sector lender HDFC Bank on Wednesday raised its marginal costs of funds based lending rates (MCLR) for July by 20 basis points (bps) across all tenures. The lender’s one-year MCLR now stands at 8.05%, according to information on the bank’s website.

The lending rates are effective from July 7. The bank had announced steeper hikes in the MCLR in May and June as the Reserve Bank of India (RBI) raised the policy repo rate in the corresponding months. The bank had increased its cost-based lending rates by 25 bps in May and 35 bps in June. 

With this increase, the bank’s overnight rate stands at 7.70%, one-month rate at 7.75%, three-month rate at 7.80%, six-month rate at 7.90%, two-year rate at 8.15% and three-year rate at 8.25%.

Last week, another private sector lender ICICI Bank raised its one-year MCLR by 20 bps to 7.75% for July from 7.55% a month ago.

Last month, all banks went for steeper hikes in MCLR after the RBI’s policy rate action. With the withdrawal of liquidity from the banking system, banks have increased interest rates on term deposits. Deposits grew by 9.3% in the fortnight ended June 3, which stood at Rs 167 trillion. However, most banks have shifted to external benchmark-based lending rates, especially in retail and home loan segments, as it leads to effective transmission of monetary policy. During the fortnight ended June 3, non-food credit rose by 12% on year to Rs 120.9 trillion.