Private Sector Banks Hikes Home and Car Loan Rates by 25-50 bps
HDFC Bank, ICICI Bank and Kotak Mahindra have raised rates on home and auto loans, reflecting the stiffening market that may lead to the Reserve Bank of India (RBI) hastening with a lift in its policy rates from record lows to fight inflation.
The country’s largest private sector lender, ICICI Bank, says it is going to charge 25 to 50 basis points more for auto loan and has discontinued its teaser offer on home loans.
In the same way, HDFC Bank has increased auto loan rates 25 to 50 basis points. Kotak Mahindra Bank has increased interest rates on auto and home loans by a parallel amount.
The new home loan rates came into effect from Monday along with the end in the teaser rate, which offered 8.25 per cent on loans of all values for the first year.
The new rates will be applicable to New or fresh loans.
HDFC, the largest credit lender, also decided not to extend its special fixed-cum-floating rate offer. ICICI Bank and HDFC Bank’s new auto loan rates, linked to the tenure and the segment, are effective Friday. For ICICI Bank, auto loans up to 35 months will now cost 9 to 13 %; loans for 36 to 60 months will cost 8.75 to 12.5 %. For HDFC Bank, the rates will be 7.5 to 15.5 %, depending on the tenure and vehicle segment.
ICICI Bank has also reworked the slabs, charging 8.75 % a year for loans up to Rs 30 lakh, instead of the earlier Rs 20 lakh ceiling.
For ICICI home loan between Rs 30 lakh and Rs 50 lakh, their rate has been revised to 9 % (from 9.25 % for loans between Rs 20 lakh and Rs 50 lakh) and loans above Rs 50 lakh will cost 9.5 % a year (from 9.75 %).
The increase in auto loan rates by private banks will provide a twin blow to car buyers, who already have to contend with an increase in prices following the government’s decision to increase excise duty 2 percentage points.
“It is a memorandum that interest rates will not go down further, they will only go up. But it (the increase) will only be to the extent to which we can protect our margins,” said Pralay Mondal, country head for retail assets and credit cards at HDFC Bank
Public sector banks, however, are expected to wait till the end of the month to review their retail lending rates.
A State Bank of India executive said that the country’s largest lender will review its home loan and auto loan rates at the end of the month. Its teaser rate offer is due to end on March 31. last week, SBI Chairman O P Bhatt had said interest rates were unlikely to go up till May-June.
The country’s largest private sector lender, ICICI Bank, says it is going to charge 25 to 50 basis points more for auto loan and has discontinued its teaser offer on home loans.
In the same way, HDFC Bank has increased auto loan rates 25 to 50 basis points. Kotak Mahindra Bank has increased interest rates on auto and home loans by a parallel amount.
The new home loan rates came into effect from Monday along with the end in the teaser rate, which offered 8.25 per cent on loans of all values for the first year.
The new rates will be applicable to New or fresh loans.
HDFC, the largest credit lender, also decided not to extend its special fixed-cum-floating rate offer. ICICI Bank and HDFC Bank’s new auto loan rates, linked to the tenure and the segment, are effective Friday. For ICICI Bank, auto loans up to 35 months will now cost 9 to 13 %; loans for 36 to 60 months will cost 8.75 to 12.5 %. For HDFC Bank, the rates will be 7.5 to 15.5 %, depending on the tenure and vehicle segment.
ICICI Bank has also reworked the slabs, charging 8.75 % a year for loans up to Rs 30 lakh, instead of the earlier Rs 20 lakh ceiling.
For ICICI home loan between Rs 30 lakh and Rs 50 lakh, their rate has been revised to 9 % (from 9.25 % for loans between Rs 20 lakh and Rs 50 lakh) and loans above Rs 50 lakh will cost 9.5 % a year (from 9.75 %).
The increase in auto loan rates by private banks will provide a twin blow to car buyers, who already have to contend with an increase in prices following the government’s decision to increase excise duty 2 percentage points.
“It is a memorandum that interest rates will not go down further, they will only go up. But it (the increase) will only be to the extent to which we can protect our margins,” said Pralay Mondal, country head for retail assets and credit cards at HDFC Bank
Public sector banks, however, are expected to wait till the end of the month to review their retail lending rates.
A State Bank of India executive said that the country’s largest lender will review its home loan and auto loan rates at the end of the month. Its teaser rate offer is due to end on March 31. last week, SBI Chairman O P Bhatt had said interest rates were unlikely to go up till May-June.
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