Kolkata-based Uco Bank is looking at lowering prime lending rates by 100 basis points, according to the bank’s chairman and managing director, Subodh Kumar Goel.
The new rate, which will be applicable from January 1, will be decided at the bank’s board meeting scheduled on December 26.
Uco Bank will also reduce rate of interest on deposits, Goel said.
“There will be substantial reduction in the lending rates. We might reduce the lending rates by 100 basis points,” he said.
“It is not possible to reduce lending rates without cutting interest rates on deposits. Now with the inflation coming down, we hope to cut the deposit rates substantially,” the CMD said at an interactive session organised by the Merchants’ Chamber of Commerce in Kolkata on Tuesday.
The bank’s benchmark prime lending rate at present is 13.75% per annum, and highest interest rate offered on deposits is 10.50% for ordinary citizens, and 11% for senior citizens.
With the recent announcement of public sector banks to give housing loans of up to Rs 20 lakh at 8.5-9.25%, Uco Bank is eyeing almost a 15% growth in housing loan disbursement.
While the bank’s exposure in real estate is Rs 6,500 crore, in the housing sector, it is about Rs 3,500 crore.
Uco Bank has also set up a crisis-management cell for corporate borrowers as demand from corporate clients has gone down suddenly, Goel said.
