HDFC Bank, recognized as the largest private bank in India, has recently announced an increment in its interest rates, much to the surprise of its customers, especially with the festive season on the horizon. This strategic decision by the bank implies an increment of 0.10% in interest rates. This adjustment is expected to translate into elevated loan rates during the forthcoming festive season.
Despite HDFC Bank’s unexpected move, the Reserve Bank of India (RBI) has maintained a steady stance on its interest rates. The central banking institution has made no alterations to its repo rate, which currently stands at 6.50%. Additionally, the Marginal Standing Facility (MSF) rate is pegged at 6.75%, while the Secured Overnight Financing Rate (SDF) is set at 6.25%. It’s worth noting that the central bank has preserved its ‘Withdrawal Of Accommodation’ stance.
According to information available on HDFC Bank’s official website, the bank has initiated a 0.05% hike in the loan base rate and a 0.10% increase in the benchmark Prime Lending Rate (PLR). These revised rates have been in effect since September 25, 2023. Moreover, the bank has also enhanced the Marginal Cost of Funds-based Lending Rate (MCLR) by 0.10%, effective from October 7, 2023.
Interestingly, even after the announcement of the hike in lending rates by HDFC Bank, its stock prices seem relatively unaffected. The shares observed a modest decline of 0.18%, with each share valued at 1518 INR.
This development comes as a jolt for many, as customers often look forward to benefiting from favorable loan terms during festive periods. However, it remains to be seen how this strategic move by HDFC Bank will impact the market dynamics and consumer borrowing patterns in the upcoming months.
