Home loan EMIs go up for old customers

EMIS or the same monthly payments on mortgage loans for customers connected to the old test, the primary lending rate (BPLR) went after the two largest private banks - HDFC and ICICI Bank - have increased their rates last week. However, customers who have switched to the new regime is the basic level reprieve as the base rate unchanged at this time.

HDFC, announced an increase in interest rates by 75 basis points, so that HDFC home loans more expensive for existing borrowers. HDFC has raised the main lending rate retail (RPLR) of 0.75 percent with effect from December 1, 2010, the statement said. With this revision RPLR rose from 14.25 percent to 15 percent.

Soon after this, ICICI Bank has decided to increase deposit and lending rates to 0.50 per cent (50 basis points).

The biggest lender in the country's State Bank of India (SBI) on Saturday said that also could raise interest rates on deposits in the same range.

The announcement on the day after the RBI Governor D Subbarao has asked banks to raise deposit rates and lower lending rates, in order to increase national saving, and encourage the necessary investment to double-digit growth.

"Deposit rates may rise by 50 basis points or more," SBI Chairman OP Bhatt said the journalists on the sidelines of the annual Bancon in Mumbai. Bhatt said that rate increases could be announced "next week".

Stating that there is little surge in credit demand, Bhatt said: "If credit growth is getting more deposits can be brought into the banking system, the best prices that started to happen ... In the current situation, they (deposit rates) can only grow".

With the demand for credit and liquidity crisis is taking is not easy, ICICI Bank has decided to raise the tenor-term deposit rates in the range from 0.25 to 0.50 percent.

However, despite the RBI proposed that banks should reduce their lending rates, ICICI has decided to increase testing rates and floating prime-rate job (FRR) for consumer loans (including mortgage loans) by 50 basis points.

The new values ​​will take effect from December 6, ICICI Bank said in a statement.

Meanwhile, Bhatt radiate confidence that banks will be able to achieve a credit growth of 19 percent in the current fiscal, as both retail and investment demand grows.

Liquidity crisis is that the Reserve Bank of marked anxiety, lenders are forced to fight for the greater part of the funds by raising interest rates on deposits.

Prospects for a very large amount drained from the system since the third quarter pre-tax payments this month is only expected to add to the problem.

The situation with liquidity will be weakened in the last quarter of the financial costs will increase due to the Government if the Prime Minister for Economic Affairs with Rangarajan said. He added that, in general, increase public spending in the last quarter of fiscal year.

On interest rates, says Bhatt, SBI will only call in the next month, as had been introduced to increase the level of new loans - the basic level, below which the bank can not provide - once in the quarter.

BPLR encourage bets on the long (main base lending rate) will also be taken in the next quarter, he said.

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