SBI, surprisingly did not pass on any benefit from its deposit rate cut to home loan seekers. The bank currently charges 10.75% interest on its home loans for amounts up to Rs. 30 lakh, while for amounts between Rs. 30 lakh and Rs. 75 lakh it charges 11%. For loan amounts exceeding Rs. 75 lakh, SBI charges an interest of 11.25%.
"By cutting deposit rates, SBI wants its cost of funds to come down first," said Kajal Gandhi, banking analyst, ICICI Direct.
"We expect it to cut base rate within a month because of the pressure from the government."
Analysts also said that SBI, due to margin pressures, did not have much leeway to cut rates.