June is the hottest month of the year. Even so for the banks' lending rates. Almost all major banks have raised their lending rates in past few days. From the State Bank of India (SBI) to Punjab National Bank (PNB), from ICICI Bank to Kotak Mahindra Bank, and from Bank of India to Oriental Bank of Commerce, the rates of interest have been hiked for borrowers. The hike of interest has followed the cycle of higher fixed deposit (FD) rates offered by these banks which kicked off in the end of May. Another addition of marginal cost for the banks came in form of higher repo rates (short term loans given by RBI to banks) that rose from 6 percent to 6.25 per cent in the RBI policy that was announced on June 6.
SBI, ICICI Bank, Punjab National Bank, HDFC and Kotak Mahindra Bank raised the interest rates before the RBI monetary policy.
However, as the Urjit Patel-led monetary policy committee (MPC) announced the tight monetary policy last week; Bank of India, Oriental Bank of Commerce and Syndicate Bank also followed.
The last time SBI, ICICI Bank and PNB raised the lending rates was in March. During that time also, it happened a day after the banks raised their rates after the FD rates were raised.
State Bank of India (SBI) Lending Rates with effect from June 1, 2018
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