State Bank of India (SBI), the largest bank in the country, has recently raised its Marginal Cost of Funds Based Lending Rate (MCLR) across various tenures by 10 basis points (0.1%).
This hike means that taking loans based on MCLR will now be more expensive, leading to higher EMIs for borrowers.
Impact of the Increase
1) One-year MCLR has risen from 8.65% to 8.75%.
2) One-month and three-month MCLR have increased from 8.20% to 8.30%.
3) Six-month MCLR has gone up from 8.55% to 8.65%.
4) Two-year MCLR is now at 8.85%, up from 8.75%.
5) Three-year MCLR has increased from 8.85% to 8.95%.
Effect on Borrowers
Most retail loans, such as home and auto loans, are linked to the one-year MCLR rate. Therefore, customers with such loans will experience a direct impact on their repayment amounts.
SBI’s Fund Raising through Bonds
SBI has also announced its successful fund raising through bonds, totaling US $100 million (approximately Rs 830 crore).
These senior unsecured floating rate bonds, with a maturity period of three years, were issued through SBI’s London branch
and are set to mature by June 20, 2024. This initiative is part of SBI’s strategy to expand its business operations.
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