A representative picture
India's two top lenders, State Bank of India (SBI) and ICICI Bank, have announced a cut of 0.15 per cent and 0.10 per cent in their lending rates, respectively, under a new system of computation, signalling a further dip in borrowing costs ahead of the busy season.
Private-sector lender ICICI Bank on Friday (Oct 28) was the first to announce a cut of 0.10 per cent in its marginal cost of funds-based lending rate (MCLR) across tenors, which was followed by a similar move by the country's largest lender SBI, but of a larger measure of 0.15 per cent.
Under the revised rates, the one-year MCLR which determined a slew of products including home loans for SBI stands at 8.90 per cent, while the same for ICICI Bank are at 8.95 per cent.
The revised rates are effective from November 1 in case of both the banks.
SBI has kept the overnight MCLR, which is the most aggressive offering, at 8.65 per cent, while the one month is at 8.75 per cent.
The announcements come after repeated displeasure shown by the regulator for not passing on the benefits of cuts to borrowers and give a boost to the sagging economic growth.
They also come ahead of the crucial 'busy season' in the second half of the fiscal which sees a spurt in loan demand.
Under the revised rate structure, the one-year MCLR — which is used for calculating the rate of interest on home loans — will come down to 8.95 per cent.
The overnight and one-month MCLR will be 8.75 per cent, while the three-month MCLR has been fixed at 8.85 per cent and six months at 8.90 per cent.
The MCLR was introduced from April this year as a transparent and effective alternative by the RBI, after banks refused to pass on the benefits of its rate cuts to the borrowers.
Even after the introduction of the MCLR, the central bank continues to be concerned on the issue of transmission which was flagged by Governor Urjit Patel at his maiden policy review this month. Banks are given a set formula to compute the MCLR based on cost of funds and are required to review it on a monthly basis, when the calls on the new rate structures are taken.
'I agree that the transmission through bank lending has been less than anyone of us would have liked to,' Patel had told reporters.
'We are hoping that over the next quarter or two, keeping in mind the government has also reduced the small savings rates, the MCLR itself will now throw up more transmission.'
Since January 2015, the Reserve Bank has reduced repo rate by 175 basis points, including the recent cut, but banks have reduced their base rates only by 60 basis points.
Obama to kick off campaign for Hillary from next week
US President Barack Obama
US President Barack Obama will launch a campaign blitz for Democrat Hillary Clinton next week as the race against Republican Donald Trump for the White House enters the final stretch.
The Clinton camp announced on Friday (Oct 28) that Obama would make the case for his former secretary of state for three straight days in as many key battleground states.
Obama's appearances could be crucial after the Federal Bureau of Investigation said it was reviewing newly discovered emails that 'appear to be pertinent' to the investigation into Clinton's use of private email while at the State Department.
On Tuesday, Obama will stump for her in Columbus, Ohio. The President will campaign in Raleigh, North Carolina, on Wednesday, followed by swings in southern Florida, including the Jacksonville area, on Thursday.
The three states account for 62 of the electoral college votes needed to reach the 270-vote minimum to win the White House in the November 8 election.
Obama won the states in 2008 and 2012, except in the case of North Carolina, which he won the first time but lost in his re-election bid.
The Clinton team has intensely targeted voter campaigns in those states, where a defeat of Trump would virtually ensure his loss in the election.
Clinton is also scheduled to campaign in Ohio, North Carolina and Florida next week, but has added an unusual stop to her calendar Arizona, a Republican Party stronghold where she is leading in several public opinion polls.
'Arizona is another battleground state that is now on the map,' campaign manager Robby Mook told reporters aboard her plane as the candidate flew into Iowa, another swing state that had been leaning toward Trump but where the polls have tightened into nearly a dead heat.
The southwestern state of Arizona, home to the 2008 Republican nominee John McCain, is "a contest that I think we can win and that's why we want to spend some time there," Mook said, adding, 'But it's a toss-up, and so are Ohio, Iowa.'
