Mumbai: Public sector lender Union Bank of India (UBI) today hiked its base rate by 50 basis points or 0.50 per cent, following the recent increase in key rates by RBI to tame inflation which is hovering at over 9 per cent.

The bank has revised its base rate, the minimum lending rate, by 50 basis points to 10.75 per cent, effective from Monday.
However, the bank has only increased the lending rate under the old BPLR (Benchmark Prime Lending Rate) scheme by 25 bps to 14.50 per cent.

More than a dozen banks have already hiked their interest rates following the monetary action by the RBI on July 26, and many more are likely to do so in the coming days as the cost of funds have gone up.

However, among the leading banks, the market leaders -- SBI, ICICI, HDFC Bank and Axis Bank- are yet to revise their rates.

The hike in interest rates come after the Reserve Bank raised its key policy rates last week by a hefty 50 bps to check high inflation.

With this, the short-term lending (repo) rate of RBI now stands at 8 per cent and the short-term borrowing (reverse repo) rate at 7 per cent.