SBI hikes prime lending rate to 13.75 per cent

11 Aug 2008

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Mumbai: The State Bank of India (SBI), the country's largest lender, has raised its prime lending rate by a full one percentage point (100 basis points) to 13.75 per cent with effect from August 12.

''Benchmark prime lending rate is revised from 12.75 per cent to 13.75 per cent," the bank said in a filing with the Bombay Stock Exchange (BSE).

The decision, which comes close on the heels of hikes in leding rates by a host of other banks, including HDFC, ICICI Bank, IDBI Bank, Bank of India, Axis Bank, Canara Bank, and Yes Bank, follows the Reserve Bank's tight monetary policy.

RBI raised its base lending rate, the repo, last month by 50 basis points to its highest in seven years at 9.0 per cent, and will hike the cash reserve ratio on 30 August.

The RBI, which unearthed around Rs2 crore of fake currency from the chest of the Dumariyaganj SBI branch, has, meanwhile, started scanning 628 currency chests of different banks across Uttar Pradesh.

Among the 628 currency chests, 62 are in districts that are along Indo-Nepal border. ''They are being checked on a priority basis," a senior RBI officer said. The vaults of the12 banks that drew currency from Dumariyaganj have been checked and no fake currency notes were found, he added.

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