The bank also announced that it will reduce its external benchmark linked lending rate as well as repo linked lending rate by 40 basis points from July 1.
The country's largest lender State Bank of India (SBI) on Monday announced it will reduce marginal cost of fund based lending rate (MCLR) by 25 basis points across all tenors from Wednesday.
The one-year MCLR has been revised to 7 per cent from 7.25 per cent, the bank said in a release.
This is the thirteenth consecutive reduction in the bank's MCLR.
The bank also announced that it will reduce its external benchmark linked lending rate (EBR) as well as repo linked lending rate (RLLR) by 40 basis points from July 1.
While EBR has been reduced to 6.65 per cent per annum from 7.05 per cent per annum, RLLR is reduced to 6.25 per cent from 6.65 per cent, it said.
"Consequently, EMIs on eligible home loan accounts linked to MCLR will get cheaper by nearly Rs 421 and those linked to EBR/RLLR will get cheaper by around Rs 660, for a 30 years loan of Rs 25 lakh," the bank said in the release.
The cut in EBR and RLLR by the bank comes after the Reserve Bank of India (RBI) on May 22 had cut repo rate by 40 basis points to 4 per cent.
Some of the banks like Punjab National Bank (PNB), Bank of India (BOI) and UCO Bank have already slashed their lending rates linked to the repo rate and MCLR rates.
SBI has also reduced its base rate by 75 basis points, from 8.15 per cent to 7.40 per cent, effective June 10.
