Lakshmi Vilas Bank cuts base rate by 0.25% to 10.70%

South-based lender Lakshmi Vilas Bank on Monday lowered its base rate or the minimum rate of lending by 0.25 percent to 10.70 percent. The rate reduction has been done following the Reserve Bank's surprise 0.50 percent rate cut at the last policy announcement, the private player said in a statement. A majority of the lenders have cut their offerings aggressively in an environment where credit growth is in the single digits, at multi-year lows.

At present, country's largest lender State Bank of India has the most aggressive posturing with a base rate at 9.30 percent, followed by others like HDFC Bank and ICICI Bank. While the banks have not passed the entire 1.25 percent reduction in key rates effected by RBI this year citing a lag in repricing of deposits, they have said that interest rates are on the downward spiral.