HDFC cuts interest rate on home loans by 20 bps to 9.9 per cent

Housing Development Finance Corporation (HDFC) has announced a 20 bps reduction in its base prime lending rate (BPLR) for home loans, which will bring down its base lending rate to 9.9 per cent, beginning 13 April.

HDFC's move comes after state-run SBI and private lender HDFC Bank earlier announced a 15 bps reduction in their respective base lending rates, on RBI pressure.

HDFC, meanwhile, also revised downwards its deposit rates across various maturities.

''I cannot talk in advance of the asset liability committee, (but) my sense is that, yes, there is a possibility that we could also look at a rate cut,'' Keki Mistry, vice-chairman and CEO, HDFC said after the Reserve Bank of India's monetary policy earlier this week.

The banks' decision to cut rates come days after the Reserve Bank of India announced status quo in its monetary policy review and governor Raghuram Rajan said the central bank would look at the transmission of previous rate cuts before going for any further rate reduction.

HDFC said the reduction in the retail lending rate would benefit all customers, including non-resident Indians. With this, EMIs would come down for the borrowers.

Besides, HDFC has also revised downwards its deposit rates across various maturities.

HDFC also said that it has got the Reserve Bank of India's clearance to raise up to $500 million (about Rs3,100 crore) as external commercial borrowing (ECB) to fund its business growth.

The approval to raise up to $500 million is valid for six months, HDFC said.