New Delhi: The lending rates in the country have reached the highest in a decade as half a dozen public sector banks hiked the rates after the Reserve Bank of India raised the short-term lending and borrowing rates on Tuesday for the eleventh time in the last 17-months.

The latest hike has raised the prime lending rates of the banks to 14.50- 15.50 percent, pushing the lending rates to the highest after 2001.

Punjab National Bank (PNB), Oriental Bank of Commerce (OBC), IDBI and Central Bank of India (CBI) announced on Friday to hike their lending rates. Two public sector banks had already increased their lending rates.

Though the Central Bank raised the repo rate by 50 basis points on Tuesday, banks have raised their lending rates by up to 75 basis points. The experts see the move as a preemptive step on the part of the banks who view RBI hiking interest rates once again in near future. The Central bank has hiked its rates for 11 times in the last 17 months.

The base rate of PNB after the hike would now be 10.75 percent. The bank has also increased its Benchmark Prime Lending Rates (BPLR) by 75 basis points taking its BPLR to 14.25 percent. The hike would make home loan, car loan, personal loan and corporate loan costlier by 0.75 percent.

OBC has raised its base rates by 50 bps taking its lending rates to 10.75 percent and BPLR to 15 percent.

Central Bank and IDBI have also raised their base rates by 75 bps each taking their rates to 10.75 percent. Both the banks have raised the lending rates costlier even for customers who have already taken loan from the banks.

However, all the banks have raised their deposit rates by 1 percent.

JPN/Bureau