Punjab National Bank raises benchmark lending rate by 0.15%; EMIs to go up

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State-owned Punjab National Bank (PNB) on Wednesday raised its marginal cost of funds-based lending rate by 15 basis points or 0.15 per cent across all tenures, a move that will lead to an increase in EMIs for borrowers.

The new rates are effective from June 1, PNB said in a regulatory filing.

The revision follows an off-cycle rate increase by the Reserve Bank in May.

The central bank hiked the repo rate — at which it lends short-term money to banks — by 0.40 per cent to 4.40 per cent.

With the revision, one-year MCLR has increased to 7.40 per cent from 7.25 per cent earlier.

Most of the loans are linked to the one-year MCLR rate.

The overnight, one-month and three-month MCLR rose by 15 basis points to 6.75 per cent, 6.80 per cent and 6.90 per cent, respectively, whereas the six-month MCLR increased to 7.10 per cent.

At the same time, three-year MCLR increased by 0.15 per cent to 7.70 per cent.

With the increase, EMIs will go up for those borrowers who have availed loans on MCLR (Marginal Cost of Funds based Lending Rate).