Mumbai-based private sector lender DCB Bank on Friday raised the lending rate based on the marginal cost of funds (MCLR) by 23 basis points on the maturities. The new interest rates will take effect from June 6. With the rise in the benchmark lending rate, EMIs on term loans are expected to increase.
In its regulatory filing, the bank disclosed that the one-year MCLR will be at 9.46% from June 6 from the current rate of 9.23%.
The three-month and six-month MCLR have been increased to 9.21% and 9.41% from the 8.98% and 9.18% currently charged respectively.
The one-month and overnight MCLR will be at 8.51% each from June 6, compared to the current 8.28% each.
DCB Bank shares closed at ₹85.50 each down 2.95% on BSE.
The MCLR is the benchmark rate below which lenders are not allowed to lend. The majority of banks do not offer rates on term loans below the MCLR. However, many banks have tied term loans like home loans and personal loans to external benchmark lending rates.
DCB Bank, a new generation private sector bank, has over 400 branches across India. It is managed and governed by professionals. DCB Bank has modern technology and infrastructure, including state-of-the-art Internet banking services for individuals and businesses.