Home loan set to get cheaper for borrowers with older base rate regime

Agencies
February 8, 2018

New Delhi, Feb 8: The Reserve Bank of India (RBI) in its monetary policy announcement on Wednesday kept key interest rates at hold, but its observations on Marginal Cost of Funds based Lending Rates (MCLR) may bring cheers to Pre-April 2016 home loan borrowers.

The home loan rates of the Pre-April 2016 have not been revised by banks in line with market rates. These home loan borrowers, who were stuck in the older base rate regime, will now be linked to the current market-linked benchmark.

In its policy statement, RBI has asked banks to link the base rate to MCLR from April 1, 2018 to ensure expeditious transmission of its policy rate to borrowers.

RBI introduced the Marginal Cost of Funds based Lending Rates (MCLR) system with effect from April 1, 2016 on account of the limitations of the Base Rate regime.

It is observed, however, that a large proportion of bank loans continue to be linked to the Base Rate despite the Reserve Bank of India highlighting this concern in earlier monetary policy statements.

"Since MCLR is more sensitive to policy rate signals, it has been decided to harmonise the methodology of determining benchmark rates by linking the Base Rate to the MCLR with effect from April 1, 2018," RBI said

Former RBI governor Raghuram Rajan introduced the MCLR to calculate the benchmark lending rate in another attempt to make banks pass on policy rate cut benefits to borrowers quickly and in a more transparent manner.

Under the base rate and BPLR, banks were following individual methodologies for computing the minimum rate at which they could lend. Under the MCLR, RBI asked all banks to follow the marginal cost of funds method to arrive at their benchmark lending rate.

MCLR is calculated after factoring in banks' marginal cost of funds (largely, the interest at which they borrow money), return on equity (a measure of banks' profitability), and negative carry on account of cash reserve ratio.

RBI will issue necessary instructions in this regard by the end of next week.

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Agencies
June 25,2020

Patna, Jun 25: At least 83 people died due to thunderstorms in Bihar in the last 24 hours, according to Chief Minister's Office.

Bihar Chief Minister Nitish Kumar announced Rs 4 lakhs each for the families of deceased.

Thirteen people died in Gopalganj, 8 each in Madhubani and Nawada, 6 each in Baghalpur and Siwan, 5 each in Darbhanga, Banka, East Champaran and 3 each in Khagaria and Aurangabad.

Due to thunderstorms, two people each lost their lives in West Champaran, Kishanganj, Jamui, Jahanabad, Purnia, Supaul, Buxar, Kaimur while one death each was reported in Samastipur, Shivhar, Saran, Sitamarhi and Madhepura.

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News Network
July 17,2020

Lukung, Jul 17: Union Defence Minister Rajnath Singh on Friday assured that not an inch of our land can be taken by any power in the world while he interacted with the Indian Army and ITBP personnel at Lukung.

Referring to the India-China border standoff, he said, "Talks are underway to resolve the border dispute but to what extent it can be resolved I cannot guarantee. I can assure you, not one inch of our land can be taken by any power in the world."

Emphasising on finding a diplomatic solution to the standoff, he further said, "If a solution can be found by talks, there is nothing better."
"Recently what happened between troops of India and China at PP14, how some of our personnel sacrificed their lives protecting our border. I am happy to meet you all but also saddened because of their loss. I pay my tributes to them," he added.

Singh interacted with the Army and Paramilitary troops here along with Chief of Defence Staff General Bipin Rawat and Army Chief General MM Naravane.

Earlier today, the Defence Minister witnessed para dropping and scoping weapons here. He also inspected a Pika machine gun.

Indian Army T-90 tanks and BMP infantry combat vehicles carried out the exercise at Stakna, Leh in presence of Singh, Chief of Defence Staff and Army Chief.

Defence Minister is on a two-day visit to Ladakh and Jammu and Kashmir. He will take stock of the situation at both the Line of Actual Control (LAC) and the Line of Control (LOC).

While Pakistan constantly violates ceasefire from across the LoC, China has continued to intrude into Indian territory in Ladakh region in recent past, escalating tensions between India and its eastern neighbour.

On June 15, twenty Indian soldiers laid out their lives during combat with Chinese forces in Galwan valley, leading to tensions between both nations. Chinese soldiers subsequently started moving back following dialogues between two countries through the military level and diplomatic level.

Singh was accompanied by the Chief of Defence Staff General Bipin Rawat and Army Chief General MM Naravane.

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News Network
February 16,2020

Washington, Feb 16: India and the United States share "unshakeable" ties, said US Principal Deputy Assistant Secretary (PDAS), Alice Wells, on Sunday, adding that the upcoming visit of President Donald Trump will further strengthen the relationship between the two countries.

"The U.S. and #India enjoy a close partnership that grows stronger day by day. Together, we are breaking records. For example, we welcomed a record number of Indian exchange students to the US last year and hope to receive even more this year," said Bureau of South and Central Asian Affairs in a tweet attributed to Alice Wells.

"The ties between our countries are unshakeable, and we look forward to an even warmer relationship as @narendramodi hosts @POTUS later this month," it added.

Trump will pay a two-day state visit to India from February 24 at the invitation of Prime Minister Narendra Modi.

"India is at the heart of the Indo-Pacific region and plays an increasingly prominent role on the world's stage. The U.S. looks forward to partnering with #India at every step of the way, " Alice Wells further said.

According to the Ministry of External Affairs (MEA), Trump is expected to attend an event at the Motera Stadium in Ahmedabad on the lines of the ''Howdy Modi'' function that was addressed by the US President and PM Modi in Houston in September last year. Trump is slated to pay a two-day visit to India from February 24.

During the visit, Trump, who will be accompanied by First Lady Melania, will attend official engagements in New Delhi and Ahmedabad, and interact with a wide cross-section of the Indian society, the MEA said in a statement.

The announcement of Trump's first official visit to India was earlier made by the White House on Monday, which, in its statement, said that the US President and Modi had agreed during a recent phone conversation that the trip will "further strengthen the United States-India strategic partnership and highlight the strong and enduring bonds between the American and Indian people".

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