Canara Bank raised BPLR by 50 bps to 12.50 per cent

Banks have started raising their benchmark prime lending rates (BPLR). Lately Canara Bank has revised its BPLR upwards by 50 basis points to 12.50 per cent, from 12.00 per cent. The revised rates will be applicable from August 12.

Bank release said, the revised BPLR will not be applicable for loans and advances granted after July 1, 2010, and to those borrowers, who have opted to switch over to base rate system.

However the revised interest rates will be applicable to the borrowers under Micro, Small & Medium Enterprises (MSME), existing housing loans linked to BPLR and Personal Loan schemes.

The RBI in its monetary review on July 27, has raised the short term borrowing (reverse repo) rate by 50 basis points and lending (repo) rate by 25 basis points as a result banks are raising their BPLRs.

RBI seeing the difficult liquidity position in the markets has not changed the cash reserve ratio- the portion of deposits banks are required to park with the central bank in cash.