Citibank cuts prime lending rate by 25 basis points to 14.75 per cent

Citibank today cut its prime lending rate by 25 basis points to 14.75 per cent, becoming the first bank to cut benchmark lending rate, following the Reserve Bank's reduction in its short-term policy rates.

At 14.75 per cent, the PLR of Citibank is way above those of most state-owned banks in the country, which peg base prime lending rates around 12 per cent.

The new prime lending rate would be effective 1 May 1, Citibank said in a statement.

RBI had, in its annual monetary policy announcement, had suggested that banks lower lending rates by lowering the cost of funds and deposit costs.

Citibank had, in November, lowered its PLR from 15.5 per cent to 15 per cent.

Following the RBI policy announcement, several banks, including public sector State Bank of India and Punjab National Bank as also the country's largest private sector lender, ICICI Bank, had hinted at revision in both lending and deposit rates in the coming days. 

ICICI had reduced its advance rate by 50 basis points to 16.25 per cent. The bank also cut deposit rates between 25 and 50 basis points across various maturities.

ICICI Bank also reduced its floating reference rate by half a percentage point to 13.25 per cent, in a move that will benefit all floating rate customers will benefit from the cut, the  bank said in a statement.