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Saturday, July 20, 2013

OBC puts on hold base rate cut

Oriental Bank of Commerce (OBC) has decided to put on hold its earlier decision to cut the base rate by 25 basis points to 10 per cent from July 22.

The implementation date for reduction in the base rate has been put on hold, OBC said in a filing with the stock exchanges.

The public sector lender had, on July 9, announced that it would reduce base rate by 25 basis points from 10.25 per cent to 10 per cent with effect from July 22.

While the bank did not give any reason to put on hold the announced cut in base rate, the recent measures by the Reserve Bank of India to arrest the slide in rupee may have prompted this move, say economy watchers.

Reversing its monetary easing stance, RBI had recently taken strong steps to tighten liquidity. The central bank adjusted the interest rate on marginal standing facility (MSF) to 10.25 per cent from 8.25 per cent earlier.

The bank rate, which is linked to MSF, was also hiked to 10.25 per cent.

Source: thehindubusinessline


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