Kotak Mahindra Bank on Wednesday raised its marginal cost of funds-based lending rates (MCLR) by 10 basis points (bps). With this, the lender’s one-year MCLR stands at 8.55%, as per information on its website. The shorter duration MCLR is in the range of 7.80-8.40% while two- and three-year MCLRs are at 8.85% and 9.05%, respectively.
Also Read: SBI hikes MCLR by 10-15 bps on some tenures
The bank has raised the MCLR by 90 bps since June. The bank increased lending rates by 20 bps in June and July each and another steep hike of 25 bps in October, following the repo rate increase of 50 bps by the Reserve Bank of India (RBI) in September.
So far, the central bank has raised repo rate by 190 bps since June.
Also Read: Bank of Baroda raises MCLR by 10 bps
The bank has 69% of the total loan book linked to floating rate, of which 53% is external benchmark linked loan rate (EBLR) and 16% is linked to the MCLR. The loan portfolio linked to fixed rate is 31%, of which loans with duration of less than one year is 22%. In addition to increasing the lending rates, banks are also raising deposit rates to support credit growth. Kotak Mahindra Bank, which has a higher CASA ratio of 56%, has locked in outflows from savings account deposit for a longer-duration term deposit, leading to retail term deposit growth of 16% on a Y-o-Y basis in Q2FY23.