Union Bank cuts base rate by 25 bps to 10 percent.
The Finance Minister’s recent ‘advise’ to banks to pare lending rates seems to be having the desired effect.
After Bank of India and Canara Bank cut their base rates last week, Union Bank of India (Union Bank) followed suit on Monday, reducing its base rate from 10.25 per cent to 10 per cent. Base rate is the minimum benchmark lending rate below which banks cannot lend.
Banks determine their actual lending rates on loans and advances with reference to the Base Rate and by including such other customer-specific charges as considered appropriate. The public sector bank said the revised interest rate is effective from today. In view of the reduction in base rate, the interest rate on home loans and car loans stands reduced to 10 per cent per annum and 10.45 per cent per annum respectively.