Allahabad Bank cuts interest on housing loans By 25 basis points

Allahabad Bank, one of the leading nationalized banks, has decided to reduce interest on Housing Loans by 25 basis points for both floating and fixed term loans up to Rs. 20 lacs, classified under Priority Sector, on all maturities. The reduction in interest rate has been given to customers as the Bank has been able to reduce the cost of incremental deposits, the general market scenario and to boost the demand in Housing Loan sector particularly among small and medium category borrowers.

The above reduction will be effective from 1st April, 2008 on all fresh sanctions. Accordingly, the minimum interest on Housing Loan for 5 year period will be 9.5% per annum and maximum would be 10.50% per annum for a period of 15 to 25 years in PLR-linked loans.

The Bank is also approaching its Board for further reduction in BPLR to make all BPLR-linked loans more comfortable for its borrowers. If approved, the proposed reduction in BPLR will also become effective from 1.4.2008.

It is pertinent to note that Allahabad Bank earlier on two occasions on 4th Sept 07 and 10th Feb 08 during the current financial year had reduced the interest rates on Home Loans with cumulative effect of reduction ranging from 150 to 175 basis points across all tenure of loans over the rates applicable at the start of the year. With this fresh cut and likely reduction in BPLR the benefit in reduction to the Home Loan customers would be even more.

Dated : 18.3.2008

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