ICICI Bank joins festive rush, cuts home loan rates by 1 per cent

Private sector lender ICICI Bank has slashed its lending rates for home loans by 0.25-1 per cent as part of a special festival offer.

The lending rate for home loans of up to Rs 30 lakh is 10.25 per cent, down from 10.50 per cent.

For loans between Rs 30 lakh to Rs 3 crore, the floating rate of interest would be 10.50 per cent against the earlier rate of 11.50 per cent, the bank said in a statement. The new rates of interest will be applicable for fixed rate loans for one and two years as well, it added.

For a fixed rate loan that runs into three years, the new offering is at 10.50 per cent for loans below Rs 30 lakh, and 10.75 per cent for those above Rs 30 lakh and up to Rs 3 crore, the bank said.

This special festival pricing is valid for sanctions till December 31, 2012, it said.

Earlier, State Bank of India had reduced rates in August and now offers the cheapest home loan after a reduction in its base rate by 0.25 per cent to 9.75 per cent. SBI now offers loans up to Rs 30 lakh at 10 per cent and loans above Rs 30 lakh at 10.15 per cent.

As per experts, many other banks are likely to come out with their festival offers on the back of ample availability of liquidity coupled with subdued growth in corporate lending. So far, banks including Punjab National Bank, Syndicate Bank, Vijaya Bank have floated their special schemes to cash in on the festival demand.

In the second quarter, credit growth was almost flat at 0.1 per cent at 16.4 per cent against the Reserve Bank's guidance of 17-18 per cent for this fiscal.