The country's second largest lender Punjab National Bank (PNB) raised both lending and deposit rates by up to 75 basis points in response to a hefty rate revision by the RBI.
The base rate or the minimum lending rate has been increased by 75 basis points to 10.75%, PNB said in a statement today.
Even the Benchmark Prime Lending Rate (BPLR) has been hiked by similar percentage points to 14.25%, it said.
With the increase, all new and existing loans, including home, auto for individuals and those for the corporates would become expensive by at least 75 basis points.
The bank has also raised interest rates on term deposits on select maturities, it added.
The revised rate will apply to all loans from August 1, 2011, it said.
Meanwhile, another public sector lender Oriental Bank of Commerce (OBC) also raised lending and deposit rates.
Both the base rate and BPLR of OBC has been revised upward by 50 basis points to 10.75% and 15%, respectively.
However, deposit rates of OBC has been increased up to 100 basis points or 1 percentage point.
The interest rate on term deposit between 91-179 days of OBC will now earn 8% from existing level of 7%, an increase of 100 basis points.
The term deposit maturity in between 189 days to less than 1 year has been revised upward by 50 basis points to 9%, OBC said in a statement.
Earlier this week, the RBI raised the short-term lending (repo) rate by 50 basis points to 8% and the short-term borrowing (reverse repo) rate to 7% in a bid to tame inflation.
Subsequently, the interest rate under the Marginal Standing Facility, an additional borrowing window, has gone up to 9% from the earlier level of 8.5%.
