Mumbai: In line with other banks, public sector lender Allahabad Bank will cut its benchmark lending rate by 25 basis points from next month, which will make its home loans cheaper by 0.5 per cent.

"The bank has decided to cut its Benchmark Prime Lending Rate (BPLR) by 25 basis points from the present rate of 13.25 per cent to 13 per cent," the bank said in a filing with the Bombay Stock Exchange today. With the cut, interest rate on housing loan of up to Rs 20 lakh in floating term loan will reduce by 50 basis points for all fresh sanctions with effect from April one, the bank said.

Already, the bank has announced a cut in the interest rate of fresh housing loans by 25 basis points in both floating and fixed term loans with effect from April one for loans up to Rs 20 lakh on all maturities. Also, all the existing interest rates linked to the BPLR, applicable on all existing and future working capital and term loans, will be reduced by 25 basis points from the next month.

Recently, leading banks, including State Bank of India and Canara Bank, reduced their lending rates by 25 basis points. Finance Minister P Chidambaram had recently said that there was a public demand for lower interest rates on home loans up to Rs 20 lakh.

Source : PTI