SBI predicts no immediate change in lending rates

The State Bank of India (SBI), country’s largest lender the first bank to launch special home loan scheme offering 8% interest rate, says no immediate change is likely in lending rates.

SBI chairman .P. Bhatt, who was on a visit in Jamshedpur, told the step taken by the bank in the home loan segment has benefited both the customers and real estate developers.

Bhatt said, “We reduced the home loan lending rates to 8 per cent per annum and as a result developers and customers started returning to the market. Other banks were also forced to follow our footsteps.”

He maintained that in market liquidity is in surplus but the credit growth has yet to pick up.

He added, “I don’t see any hike in lending rates of the bank in the next six months. There is enough money available in the market and banks are not facing any difficulties in providing credit to customers at this point of time”.

MoU inked between SBI and Honda Siel Cars

A Memorandum of Understanding (MoU) was inked between State Bank of India (SBI) and Honda Siel Cars India Ltd for providing auto retail financing to prospective customers.

According to company’s press release SBI will be the preferred financier for the entire range of vehicles marketed by Honda Siel Cars in India.

Honda Siel Cars' director (marketing) Tatsuya Natsume and SBI's chief general manager, personal banking business unit, P Nanda Kumaran signed the MoU.

The main aim of signing MoU is to target high-end customers who will be taking car loans of above Rs 5 lakh from the bank. SBI has launched a special scheme called SBI Advantage Car Loan Scheme for this segment. The bank release said the scheme is available for individuals – salaried, professionals, self-employed, businessmen and proprietary/ partnership firms- who pay income tax and whose income/net profit or gross taxable income is Rs2.50 lakh and above.

SBI under its car loan is giving 85% of on-road price of the car with a repayment period of 7 years as maximum applicable to all categories of customers. Bank is charging only 0.50% of the loan amount as processing fee.

The release said, the USP of the product is the loans will be sanctioned on a priority basis.

SBT extended home loan scheme, withdrawn car loan scheme

The State Bank of Travancore (SBT) has also extended its Aishwarya Home Loan scheme till March 31, 2010, and has reintroduced processing charges.

Under this scheme the home loans taken during this period will be offered at the rate of 8 per cent (fixed) during the first year, then for the next two years the rate would be 9 per cent (fixed) on up to Rs 30 lakh and for the next two years it would charge 9.5 per cent (fixed) for above Rs 30 lakh.

According to bank press release, subsequently the interest rates for these loans after wards will be at 2.5 per cent below prime lending rate (floating) for limits up to Rs 30 lakh and at 2 per cent below prime lending rate (floating) for limits above Rs 30 lakh.

For the time being SBT has withdrawn its Aishwarya Car Loan scheme from December 1, and consequently the SBT Car Loan scheme will be available at normal rates with processing charges. The normal rates of car loan scheme charged by the bank range from 11 per cent to11.25 per cent for a tenure of up to seven years, the release stated.