Banks slash rates in New Year gift; SBI leads and PNB, Union Bank follow

The country’s largest bank State Bank of India (SBI) announced a steep interest rate cut in several years on Sunday, by reducing its marginal cost of funds based lending rate (MCLR) by 90 basis points (bps) across all maturities. 

With this cut, SBI has passed on benefit of 200 bps since January 2015 to customers, which is more than 175 bps reduction in the Reserve Bank of India’s (RBI) policy rate cut in the same period. 

The new rates come into force from today. SBI’s one-year MCLR stands reduced to 8% from 8.9%, while the rate on overnight loans is