PSBs trump private banks in rate transmission again

PUBLIC SECTOR BANKS (PSBs) saw faster transmission of rates than their private peers for the second month in a row.

- KSHIPRA PETKAR

Lending rates of PSBs fell 56 bps month-on-month to 7.82% against 41 bps for private banks.

According to provisional data from the Reserve Bank of India released on Thursday, in March and April, rate transmission by private banks was faster than PSBs at 0.08 bps and 0.24 bps on month (see table).

Overall, the weighted average lending rate (WALR) on fresh rupee loans of scheduled commercial banks fell 58 basis points to 8.62% in June—the biggest drop since the beginning of the rate cut cycle by the RBI in February.