GOOD READS

SBI bid to cash in on festivity

Mumbai, Oct. 17: The State Bank of India today took the battle to its rivals by slashing the processing fees for home and car loans by 50 per cent. The country's largest commercial bank recently sparked a rate war by offering one of the lowest interest rates on home loans in a bid to corner business in the festive season when borrowers traditionally scout for deals.

The reduction in the processing fees is seen as an attempt not only to attract new customers with the festival season around the corner but also poach on the base of its rivals. The country's regulators ' the Reserve Bank of India and the National Housing Bank ' have done away with the levy of pre-payment penalty, thereby providing home loan borrowers a good opportunity to shift to lenders such as the SBI who charge a lower interest rate.

In August, the country's largest bank brought down interest rates on housing loans up to Rs 30 lakh to 10.25 per cent from 10.50 per cent. Similarly, interest rate on home loans above Rs 30 lakh and up to Rs 75 lakh were revised to 10.40 per cent against 10.75 per cent earlier. Subsequently it reduced the benchmark base rate by 25 basis points, thus making home and auto loans even cheaper. The housing loans provided by the SBI are at least 25 basis point lower than those offered by its larger peers.

In a statement issued today, the bank said the new processing charges would be applicable to loans availed from October 17 to December 31. "With this reduction, the bank is quoting the lowest processing fee on both home and auto loans to our customers," it said.

For home loans up to Rs 25 lakh, the processing charge has become 0.125 per cent of the loan amount from 0.25 per cent earlier. Similarly, in case of loans between Rs 25 lakh and Rs 75 lakh, the processing fee would now stand at Rs 3,250 against Rs 6,500, while for loans above Rs 75 lakh, it would be a flat Rs 5,000 compared with Rs 10,000 per application earlier.

With regard to auto loans, the processing charge has been slashed to 0.255 per cent of the loan amount against 0.51 per cent. It will come down to Rs 510 on the lower side.

"Despite the reduction in home-loan rates on new loans, we believe the risk of higher pre-payment in the existing home-loan book of private players is a concern. The difference between new home loan rates offered by SBI remains high compared with around 11 per cent plus charged to existing customers of HDFC. Banks and housing-finance companies do not charge a pre-payment penalty (as mandated by the regulator) thereby making their portfolios more vulnerable to pre-payment," a report from Kotak Institutional Equities said.

Quiz: How well do you know India's economy?

Question 1

Which of these products is India the world's largest producer of?

Poll Choice Options
  • Wheat
  • Rice
  • Milk
1
2
3
4
5
6
7
8
9
10

Latest News

  • GM to invest $12 bln in China and plans more plants

    U.S. car giant General Motors Corp (GM) (GM.N) plans to invest $12 billion in China from 2014 to 2017 and build more plants next year as it steps up its presence to compete with aggressive rivals in the world's largest auto market. GM expects its China sales to expand 8-10 percent this year, in line with the overall growth of the Chinese market, where foreign firms, such as Volkswagen AG (VOWG_p.DE), and domestic players like SAIC Motor Corp vie for more market share. In total we are …

  • In the driving seat: China's yuppies are new market force for global a …

    SHANGHAI/BEIJING (Reuters) - Global automakers are scrambling to meet the demands of China's young urban professionals, who want a car that makes them stand out, yet don't always have the money to splurge on a top-end model. After nearly two decades of frenzied growth driven mainly by the very wealthy, China's auto market is maturing, yet remains ferociously competitive with manufacturers having to react quickly to shifting consumer trends. People like Zhou Wenxi, a 32-year-old Shanghai …

  • Delhi Metro completes 21-metre high cross-over viaduct

    New Delhi, April 20 (IANS) The Delhi Metro Sunday announced the completion of its construction of a cross-over viaduct above the existing operational line at east Delhi's Karkarduma Metro station, 21 metres above the ground. Calling it a rare feat, the Delhi Metro said this is among the first of such achievements as it is poised to repeat similar feats in the construction of its Phase III, slated to be completed by 2016. "Construction for crossing over of Metro viaduct at the existing …

  • Karnataka orders Toyota, union to restore normalcy

    Bangalore, April 20 (IANS) The Karnataka government has ordered Toyota India and its workers' union to restore normalcy in operations with immediate effect, after there was no let-up in the month-long standoff. "The government of Karnataka, in order to maintain industrial peace and harmony, has issued an order asking the company and the union to restore normalcy in operations immediately," Toyota Kirloskar Motor Ltd. said in a statement Sunday. The statement, however, did not mention when the …

  • Legal battle over Panipat-Jalandhar expressway settled

    New Delhi, April 20 (IANS) Construction of the stalled six-lane, 291-km expressway between Panipat and Jalandhar can now resume with the Supreme Court giving relief to its developer, the Hyderabad-based Soma group, by allowing the toll plaza to be shifted. The apex court set aside an earlier verdict of the Punjab and Haryana High Court that had allowed the National Highways Authority of India (NHAI) to take over the project after the Soma-led consortium expressed difficulties in completing the …

IN-DEPTH ANALYSIS & INTERVIEWS

  • This might well be India’s biggest Ponzi scam

    It was just too good to be true. Ashok Khital, 45, displays every symptom of a man who knows he's been conned. …

  • India's star studded football league

    High and mighty including Sachin, Salman & Sun Group buy ISL teams …

  • Leaderspeak with Rajesh Janey

    Rajesh Janey, President - India & SAARC, EMC shares many firsts in his life. …

  • Seed of Doubt

    Field trials have been allowed again in India. But two decades after their global launch, genetically modified (GM) crops remain controversial. …

  • Power Hungry

    Gujarat has power round-the-clock. Most other states do not. Why this will matter in the general elections. …

  • Etcetera

    The most keenly watched contest of the current general election will be the one for the Varanasi parliamentary seat, where the Bharatiya Janata Party's prime ministerial hopeful Narendra Modi squares off ... …

  • Economy vs Democracy

    As the country gets election fever, cash comes out of mattresses and turns into liquor, gifts, and food. But it is not bad for the health of the economy, reports Sarika Malhotra from the trenches. …

MARKET MOVERS

  • Most Actives
    Most Actives
    NamePriceChange% Chg
    16.52+0.88+5.63%
    UNITECH.BO
    73.85+3.05+4.31%
    HDIL.BO
    13.36+0.25+1.91%
    SUZLON.BO
    718.55-6.70-0.92%
    HDFCBANKSL.BO
    57.40+2.75+5.03%
    JAIPRA.BO
  • Price % Gainers
    Price % Gainers
    NamePriceChange% Chg
    12.60+2.10+20.00%
    AGRIMONY.BO
    242.50+40.40+19.99%
    ACRYSIL.BO
    83.50+13.90+19.97%
    SICAL.BO
    46.00+7.65+19.95%
    SHRGLTR.BO
    65.25+10.85+19.94%
    AHLUCONT.BO
  • Price % Losers
    Price % Losers
    NamePriceChange% Chg
    11.60-2.70-18.88%
    ANISHAIMPEX.BO
    51.10-8.85-14.76%
    WINSOMTX.BO
    11.70-1.30-10.00%
    BLCISER.BO
    425.00-40.00-8.60%
    GCMSECU.BO
    59.40-5.55-8.55%
    JBML.BO
  •  
    Recent Quotes
    Symbol Price Change % ChgChart 
    Your most recently viewed tickers will automatically show up here if you type a ticker in the "Enter symbol/company" at the bottom of this module.
    You need to enable your browser cookies to view your most recent quotes.
  • Recent Quotes News

    •  
      Sign-in to view quotes in your portfolios.