NEW DELHI: Home, auto and personal loans from State Bank of India, HDFC, Punjab National Bank and Oriental Bank of Commerce have become costlier by up to one percentage point, with these lenders on Tuesday announcing a hike in interest rates.

The hike follows the increase in the cost of funds to banks after the Reserve Bank of India raised short-term rates (repo and reverse repo) by 0.5 percentage point in the last two months.

While the country's biggest lender, State Bank of India, has hiked its Prime Lending Rate (PLR) by 0.25 percentage point, top home loan lender HDFC increased lending rates by 0.50 percentage point to 9.5 per cent for floating options and to 11 per cent for fixed options.

Delhi-based Oriental Bank of Commerce has hiked home loan rates by 50 to 100 basis points, while raising the deposit rates by 0.25 percentage point across all maturities.

"Taking into account market conditions and increase in the cost of funds, the bank has decided to hike home loan rates by 50 to 100 basis points, effective August 7,'' Oriental Bank of Commerce Chairman K. N. Prithviraj told PTI.

OBC's floating rates for loans maturing in 10 years, have gone up to 9.25 and 9.75 per cent from 8.75 per cent for Rs. 20 lakh and above Rs. 20 lakh, respectively.

Similarly, the floating rates have gone up from 9 per cent to 9.5 and 10 per cent for loans below Rs. 20 lakh and above Rs. 20 lakh, respectively, that have a repayment tenure of more than ten years.

Our New Delhi Special Correspondent writes:

PNB follows suit

Punjab National Bank on Tuesday announced with immediate effect 0.5 percentage point hike in home loan rates and 0.25 percentage point increase in other lending rates.

The interest rate on housing loan is hiked by 50 basis points, while the Benchmark Prime Lending Rate (BPLR) has been raised by 25 basis points.

According to senior bank officials, the effect of the decision is that the floating home loan interest rates have gone up to 8.75 per cent for a maturity period of up to five years, to 9 per cent for 5-10 years, to 9.25 per cent for 10-20 years and to 9.75 per cent for 20-25 years.

In the case of fixed home loan, the rate has gone up to 10 per cent from 9.75 per cent for loans up to five years.

The bank increased its BPLR by 25 basis points or 0.25 percentage point to 11.50 per cent from 11.25 per cent.

It means, the bank has hiked interest rates for all other loans, including for auto and personal loans, by 0.25 percentage point.

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