Kotak Mahindra Bank hikes base rate by 0.50 pc to 8.75 pc

Mumbai, Feb 24 (PTI) Private sector Kotak MahindraBank today hiked its minimum lending rate or the base rate by0.50 per cent to 8.75 per cent.

The revision, effective March 1, from thecity-headquartered lender comes within a day of the largestprivate sector bank ICICI Bank and HDFC Bank announcingsimilar moves.

Apart from the base rate, which was implemented Julylast year to make bank lendings more transparent, KotakMahindra also hiked its interest rate on older loans whichcontinue to be under the BPLR (benchmark prime lending rate)system by 0.50 per cent to 17.50 per cent, a release issuedhere by the bank said.

A majority of the loans given under the older BPLRsystem are yet to migrate to the newer base rate regime.

A slew of public sector banks, including the country''sbiggest lender State Bank of India, have hiked lending ratessince RBI hiked its key rates by 0.25 per cent on January 25with a view to tame inflation.

Repo -- the rate at which the central bank lends to banks-- now stands at 6.50 per cent while the reverse repo -- atwhich it accepts excess cash of the banks -- has been upped to5.50 per cent.