SBI raises lending and deposit rates by 25 basis points

While the higher deposit rates would provide better returns to savers, the rise in the lending rate would increase the equated monthly instalments (EMIs) for auto and home loan borrowers. Besides, corporate loans will also become expensive

New Delhi: Borrowers from the State Bank of India (SBI) will have to pay higher interest rates (at least by 0.25%), but new depositors of 555- and 1,000-day term deposits with the country's largest bank would earn that much more.

SBI's decision to raise rates follows a similar move by over a dozen other banks.

The bank revised the base rate-or the minimum lending rate-by 25 basis points to 8.25%, the bank said in a statement. The benchmark prime lending rate (BPLR) for existing customers has been increased by 25 basis points to 13 percent.

The hike in the BPLR would make existing loans costlier, while the base rate increase will make new loans expensive.

While the higher deposit rates would provide better returns to savers, the rise in lending rate would increase the equated monthly instalments (EMIs) for auto and home loan borrowers. Besides, corporate loans will also become expensive.

With the increase in base rate, most of the loans except new home loans-would be dearer by at least 25 basis points (or 0.25 percent).

However, there was no clarity with regard to housing, because the bank runs teaser schemes under which interest rates are lower in the initial years of the credit period.

In order to bring in more transparency, the base rate was introduced as replacement for the BPLR from 1 July 2010.

In the base rate regime, banks cannot offer loans below their announced rate. However, in the BPLR regime, the loans were sanctioned below the benchmark depending on the creditworthiness of the customer.

Besides, the bank has also increased its fixed deposit rates on two select maturities by 25 basis points.

Both the 555- and 1,000-day fixed deposits would attract 9.25% interest rates from the existing 9 percent. The new rates would be effective from 14th February.

SBI last revised both its lending and deposit rates on 1st January this year. The base rate was increased by 40 basis points, while deposit rates were hiked up to 100 basis points across various maturities.

Banks have been raising interest rates following a 0.25 percentage point hike in short-term lending (repo) and borrowing (reverse repo) rates announced by the Reserve Bank of India (RBI) in its third quarterly review of monetary policy, last month.

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Exports grow by 32.5% to $20.60 billion in January

During April-January of this fiscal, the country’s shipments went up by 29.4% to $184.60 billion. The commerce secretary has told the media that this performance was a ‘huge’ jump, and he expects shipments to ‘cross $200 billion’ by February

New Delhi: The country's exports grew by a healthy 32.5% year-on-year to $20.60 billion in January 2011 on account of increasing demand from Western markets. During April-January this fiscal, the country's shipments went up by 29.4% to $184.60 billion, reports PTI.

"It is a huge jump... (the) export performance is pretty damn good... By February, we should cross $200 billion," commerce secretary Rahul Khullar told reporters here.

Imports in January 2011 are estimated to increase by 13.1% to $28.6 billion over the same period last year, leaving a trade deficit of $8 billion during the month under review,
Mr Khullar added.

During April-January, 2010-11, imports rose by 17.6% to $273.60 billion.

"The import numbers will be revised," Mr Khullar added. During the first 10 months of the financial year, the trade deficit stood at $89 billion.

Sectors that registered healthy growth during April-January 2010-11 include gems &jewellery, engineering, petroleum and oil lubricants, he added.

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SC slams govt, Reliance Infocomm over Amar Singh phone-tapping issue

The remarks of the bench came as Reliance Infocomm had intercepted Mr Singh’s telephone between 22nd October and 21st December 2005, on the basis of two letters of the “competent authority” which had several grammatical errors. Subsequently, it was found that the signatures of the officers were forged

New Delhi: The Indian apex court on Friday slammed the government for not cancelling the licence of Reliance Infocomm for illegally tapping the telephone of politician Amar Singh on the basis of forged orders, reports PTI.

"Why didn't you cancel the licence of the service provider? It's gross negligence. Either service provider was doing deliberately or because of its incompetence on the basis of a letter full of errors.

"There were gross errors in the letter on which the interception was done. Government should have cancelled the licence of the service provider per se," a bench comprising Justices GS Singhvi and AK Ganguly said.

The Reliance Infocomm company has been with the group headed by Anil Ambani after the split between the Ambani brothers in July 2005.

"That was in 2005, now it is 2011 and (the) service provider has been allowed to continue with its business. The government has not taken any action so far. It is a serious matter and why action has not been taken against the service provider," the SC bench said.

The remarks of the bench came as Reliance Infocomm had intercepted Mr Singh's telephone between 22nd October and 21st December 2005, on the basis of two letters of the "competent authority" which had several grammatical errors and subsequently it was found that the signatures of officers were forged.

"The letters were coming from the senior police officer and Home Secretary, the senior IAS officer. The whole content should have been examined for public safety. It was such a serious matter. This type of order has been acted upon by the service provider. The citizen of this country has no safety. They are subjected to interception by unscrupulous service providers," the bench said.

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