Central Bank reduces lending rates

Mumbai: Central Bank of India (CBI) has decided to reduce its medium-term lending rates (MTLR) for term loans by 50 basis points. It has also cut its deposit rates by 25 basis points.

With these cuts, CBI becomes the first bank to reduce its lending and deposit rates after the 50-basis points cut in the small savings rates in the Budget 2002-03. The medium-term lending rate of the bank has been brought down to 12 per cent from 12.5 per cent, with effect from 1 April 2002. The prime-lending rate of the bank, however, remains unchanged at 12 per cent.

The bank has also trimmed its deposit rates by 25 basis points across the board. For deposits of less than Rs 15 lakh for a tenor of 15 to 45 days, the rate is now 4.75 per cent; for a period of 46 to 179 days, the rate will be 5.5 per cent; for a period of 180 days to less than one year, the rate is 6.5 per cent; the rate is 7.25 per cent for deposits of one year to less than two years; 7.5 per cent for two years to less than three years; 8 per cent for three years and above.

A bank press release said the revised deposit rates will apply only to fresh deposits and renewals of maturing deposits.