Andhra Bank cuts lending rate by 0.25% to 9.75%

Public sector lender Andhra Bank on Tuesday slashed its benchmark lending rate by 0.25 per cent to 9.75 per cent with effect from today, ie September 29 after RBI cut repo rate by 50 basis points.

The public sector bank is the first bank to cut its rate after Reserve Bank of India's (RBI) monetary policy review.

The central bank has brought down repo rate, the rate at which RBI lends money to commercial banks in the event of any shortfall of funds, to 6.75 per cent. Accordingly, reverse repo rate stands at 5.75 per cent. However, CRR has been kept unchanged at 4%.

It is expected that more banks will follow the suit and slash their lending rates.