Allahabad Bank's Home Loan, Car Loan and Cheaper, Bank cuts interest rates drastically
The public sector Allahabad Bank has announced a steep cut in the interest rate of 0.40% for external benchmark-linked loans. The new rates announced by the bank will come into effect from March 2020. The bank has informed the stock markets, "".... The Asset Liability Management Committee of the bank has decided to revise the interest rates for products linked to external benchmarks. These rates will come into effect from March, 2020. However, the RBI has not reduced the interest rate in the repo rate in the bi-monthly monetary review on the last two occasions. Rbi's repo rate is currently 5.15%.
RBI cuts repo rate by 1.35% last year
The central bank had cut the repo rate on five consecutive occasions last year. RBI had reduced the key policy rate repo rate by 1.35% last year. However, the central bank, concerned with the banks not giving the benefit of repo rate cuts to the common customers, had made it mandatory to introduce external benchmark based products by taking a strong stand. The central bank had cut the repo rate to reduce the EMI burden on the people so that more cash left in the hands of the people and increased domestic composition.
Allahabad Bank came into existence in 1865
Earlier, the bank had reduced the interest rate based on marginal cost of funds by 0.05% on February 14. The bank had announced to reduce the interest rate on MCLR based loans of all periods. Allahabad Bank is headquartered in Kolkata. Allahabad Bank was established in Allahabad in 1865. Allahabad Bank is to be merged with Indian Bank in the grand merger of proposed banks on April 1, 2020. It was announced by the central government in August last year.
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