HDFC Bank, Union Bank cut lending rates

HDFC Bank became the first from the private sector to cut benchmark prime lending rate in the past few months, citing a reduction in its incremental cost of funds, reports HT Correspondent.

HDFC Bank on Monday became the first from the private sector to cut benchmark prime lending rate (BPLR) in the past few months, citing a reduction in its incremental cost of funds.

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Union Bank of India has also lowered its BPLR but has not extended the reduction in its BPLR to its home loan customers. Union Bank had in November reduced its BPLR by 75 basis points along with all other public sector banks on prodding by the finance ministry. Union Bank has revised downward its BPLR benchmark to 12.50 per cent from 13.25 per cent with immediate effect, whereas HDFC Bank has lowered its BPLR by 50 basis points effective in two tranches of 25 basis points each from December 15 and January 1.

HDFC Bank does not extend home loans on its own. It sources home loan customers for its promoter HDFC.