Karur Vysya Bank to lower base rate and prime benchmark rate
Private sector lender Karur Vysya Bank (KVB) on Thursday said it will cut its base rate and benchmark prime rate to 7.75% and 12.75%, respectively, effective December 15, 2021.
The lender will reduce its base rate from 0.25% to 7.75%. It will also downgrade the Prime Reference Rate (BPLR) by a similar range of 12.75 percent. “We advise that the base rate and the bank’s BPLR would be revised with effect from December 15, 2021,” KVB said in a regulatory filing.
Meanwhile, on Wednesday, the Reserve Bank kept its policy rate – at which it lends money to banks – unchanged at 4% for the ninth time in a row, to support growth while keeping concerns about the economy in mind. new variant of the coronavirus.
The base rate refers to the minimum rate for all loans and banks are not allowed to resort to loans below the base rate. Banks are required to review the base rate at least quarterly.
In banking jargon, BPLR stands for the benchmark prime rate. With the introduction of the base rate, the BPLR is made applicable normally only on loans which were sanctioned before the introduction of the base rate. The base rate system replaced the BPLR system with effect from July 1, 2010. KVB shares were trading at Rs 50.57 each on ESB, up 4 percent from the previous close.