SBI lowers interest rates on home loans above Rs 75 lakh

Mumbai: Country’s largest bank, State Bank of India ( SBI) has taken a lead and lowered interest rates on loans above Rs 75 lakh. This comes within days of Reserve Bank of India reducing capital requirement on big ticket home loans.

The bank has lowered home loans rates by 10 basis points for home loans above Rs 75 lakh to 8.55% for women and 8.60% for others. SBI has said that the revised rates are effective from June 15.

The RBI in its monetary policy lowered risk weightage on home loans from 75 basis points to 50% bps and the provision for standard assets was reduced to 25 bps from 40 bps.

Speaking to media soon after monetary policy was announced, N S Vishwanathan deputy governor RBI, “We have observed that delinquency is lowest in the home loan segment. We have reduced the SLR by 50 basis points as a part of the transition to 100 percent liquidity coverage ratio by January 2019. In the interim it will provide some liquidity to banks. Possibly these two measures together should bring some buoyancy to the home loans segment.”

“Fifteen basis points reduction in standard asset provisioning will make the interest rate cheaper by 3-4 basis points,” said Gagan Banga, vice-chairman, Indiabulls Housing Finance Company told ET early this week..