IDBI Bank, the public sector lender, on 18 April 2012 cut its deposit rates by 10-50 basis points across various maturities. The bank also reduced lending rate benchmarks — base rate and benchmark private lending rate — by 25 basis points.
IDBI is the first bank to cut rates following the 50 basis points cut in repo rate by the RBI. Following the rate cut, the new base rate is 10.5 per cent and the BPLR is 15 per cent.
Several other banks including the State Bank of India is expected to follow the path of IDBI in the backdrop of curtailed repo and reverse repo rates. The RBI in its quarterly review of monetary policy on 17 April 2012 had cut down the Repo Rate and Reverse Repo Rate by 50 basis points each.
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