New Delhi: After ICICI, it was the turn of country’s biggest mortgage firm Housing Development Finance Corp (HDFC) to increase its prime lending rates.
HDFC on Monday announced a hike in its key lending rates by 75 basis points to 14.25 per cent. The move follows the CRR hike by RBI on Friday—a step taken by the apex bank to contain liquidity in the Indian markets.
The Reserve Bank of India had announced on Friday a hike in its short-term lending rate by 25 basis points. ICICI Bank raised rates on Saturday and other banks are expected to follow suit.
Arun Shandilya, DMD and CFO of SBI said that most banks are under pressure to review the interest rates because of the RBI decision.
While most banks are likely to hike lending rates by 50-100 basis points in April, they may go slow on passing the benefits of rising interest rates to retail depositors. None of them have so far announced a hike in deposit rates.
However, one thing is for sure that the days of easy credit and low EMIs are over. There is no way that banks can offer cheap loans to anybody henceforth. Interest rates for all other segments like car loans, auto loans, personal loans and education loans are also likely to go up.
With agencies inputs
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