Indian Overseas Bank Also Increased Repo Linked Lending Rate

Indian Overseas Bank also increased repo linked lending rate, loan will be expensive.

Many banks have increased the repo-linked lending rate after the Reserve Bank of India increased the repo rate on May 4.

Now Indian Overseas Bank has also joined in this episode. Indian Overseas Bank has increased the lending rate linked to the external benchmark.

The bank has revised it to 7.25 percent, which is applicable from today i.e. May 10.

“Our bank has revised the Repo Linked Lending Rate (RLLR) to 7.25 percent (ie 4.40 percent +2.85 percent = 7.25 percent),” the lender said in a regulatory filing.

This will make the loan costlier and will increase the EMI burden on the customers.

It is worth noting that Indian Overseas Bank, HDFC Bank, Canara Bank, Bank of Maharashtra, and Karur Vysya Bank have also revised their lending rates based on MCLR and repo rates.

Let us inform you that for the first time since August 2018, the RBI had increased the repo rate by 40 basis points on May 4, with which it was increased to 4.40 percent.

The central bank had also raised the cash reserve ratio by 50 basis points to 4.5 percent.

This happened at a time when everyone expected that the central bank could take such a step, but it was not expected that this step could be taken so soon.

Finance Minister Nirmala Sitharaman herself had reacted to this and said that the hike in the repo rate by the Reserve Bank was not surprising, but the timing of increasing it was shocking.

He had said, “The timing of RBI’s rate hike was a surprise and not a rate hike. People were thinking that this work had to be done anyway.”

“This was surprising as it happened between the two MPC (Monetary Policy Committee) meetings. But, the US Fed was saying this over and over again.”

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