Mumbai
Within a day of the RBI reducing repo rate by 25 basis points, the country’s largest lender State Bank of India on Friday announced a cut in interest rates by 5 basis points on its home loans up to Rs 30 lakh.

In its sixth bi-monthly monetary policy review announced on Thursday, the RBI had cut the repo rate by 25 basis points to 6.25 per cent.

“On the back of the monetary policy announced by the RBI, we have taken the lead to cut interest rates on home loans up to Rs 30 lakh,” the bank’s chairman, Rajnish Kumar, said in a statement.

He said the bank has the highest market share of the home loans market and it is appropriate to empower the large lower and middle class segment by transmitting the rate cut announced by the RBI.

For effecting a rate cut in home loans, the bank will either have to decrease its one year MCLR or can go for a cut in its spreads over MCLR for the product, he said. Within hours of the RBI move, state-run Bank of Maharashtra had announced a 0.05 percent cut in its MCLR for sixth-month loan tenor.