SBI ups base lending rate by 25 basis points to 8.50 per cent

State Bank of India (SBI), the country's largest lender, today announced a 25 basis point increase in its base lending rate, making its retail finance, including home and auto loans, dearer.

SBI also raised its benchmark lending rate by the same margin, raising the cost for all existing borrowers as well.

The new rates, which are effective 25 April 2011, would push SBI's base rate to 8.50 per cent from the existing 8.25 per cent.

At 8.50 per cent, SBI's base rate is still the lowest among all major commercial banks, including state-run banks.

The base rate for most state-run banks is above 9 per cent while it is 8.75 per cent for ICICI Bank, India's largest private sector lender.

SBI's benchmark prime lending rate (BPLR) would also go up by 25 basis points to 13.25 per cent.

The base rate, to which all banks have to base their lending rates, was introduced in July last year to ensure transparency in banks' lending policies and rates.

The BPLR is used for determining interest rates on loans and advances sanctioned up to 30 June 2010.