"The revised rates will be effective from June 22, 2015," it said. The reduction, the bank added, was a consequence of the recent term deposit rate cuts of up to 25 basis points it had carried out across various tenors that were made effective from June 17, 2015.

This is the first rate cut by Mumbai-based Yes Bank and comes after three rounds of key policy rate reductions by the Reserve Bank -- 0.75 percent in all so far this year.

Bigger lenders like HDFC Bank and State Bank of India have effected two rounds of rate cuts since April, when the bankers were chided by Governor Raghuram Rajan for not passing the rate cuts to borrowers.

Yes Bank's rate is still higher than the aggressive posturing by its rivals in the market, where offerings start from 9.70 percent.

Ahead of a recent meeting with Finance Minister Arun Jaitley, Yes Bank's Chief Executive and Managing Director Rana Kapoor had hinted of there being a possibility of a 0.25 percent cut in lending rates.

The RBI and the Finance Ministry want banks to cut rates for better transmission of the policy actions and to help boost the economic growth recovery, respectively.

Latest News  from Business News Desk