Indian Overseas Bank has increased marginal cost of funds-based lending rate (MCLR) by 10 basis point.
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"The two and three-year MCLRs have been hiked by a similar margin to 7.80 percent each. Among others, the overnight MCLR will cost 7.05 per cent, while one month at 7.15 percent. The three and six-month MCLRs are up at 7.70 percent each. The revised MCLRs will come into effect from September 10, 2022," Indian Overseas Bank said in a regulatory filing.
This move will make consumer loans costlier.
The bank reported a 20.1 percent rise in net profit to Rs 392.18 crore despite a 2.5 percent decline in total income to Rs 5,028.20 crore in Q1 FY23 over Q1 FY22.
Indian Overseas Bank is one of the 12 public sector banks (PSB) in which the Government of India held 96.38 percent, as of 30 June 2022. This is followed by institutional investors, public and others.
Meanwhile, the Bank of Baroda has also decided to increase its MCLR by 0.10 percent that will come into effect from September 12, 2022.
"Bank of Baroda's one-year MCLR will be priced at 7.80 percent against 7.70 per cent," the bank said in a regulatory filing.
The six-month MCLR will be up at 7.65 percent from 7.55 percent while three-month MCLR will be at 7.50 percent compared to 7.45 percent.
Many banks have raised their lending rates following a 140 basis points hike in repo rate by the Reserve Bank of India (RBI) so far this financial year. The central bank is expected to hike interest rates further to tame high inflation.
The Reserve Bank of India's norms require banks to review their lending rates every month based on the marginal cost of funds.
-With inputs from PTI
First Published: Sept 12, 2022 1:34 PM IST
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