Mumbai, March 14: In a bid to pass on the benefit of reduction in its borrowing costs, ICICI Ltd has decided to reduce its prime lending rate by 50 basis points across the maturities with effect from March 14.The revised prime lending rate of the institution is pegged at 12.5 per cent for short term prime rate (STPR), medium term prime rate (MTPR) and long term prime rate (LTPR).
The other two major financial institutions - Industrial Development of India (IDBI) and the Industrial Finance Corporation of India (IFCI) are expected to follow suit.The STPR will be of a variable maturity with interest rates to be re-set-annually.
ICICI's borrowing costs have declined during the post-budgetary announcement compared to costs prevailing at the time of previous PLR revisions. In line with with its focus on delivering value to its customer, ICICI has decided to provide the benefit of reduction in its borrowing costs to its clients, said a press release.
ICICI has always been seeking to lower resource costs so as to deliver credit at a lower cost to Indian corporates. As the Centre has proposed a cut in the benchmark interest rate on small savings schemes, besides cuts in the public provident fund (PPF) by 1 per cent to 1.5 per cent. As the Reserve Bank of India (RBI) has also cut the bank rate by 1 per cent in two steps, market interest rates are expected to show a downward trend, said the press release.
Copyright © 2001 Indian Express Newspapers (Bombay) Ltd.
