Punjab National Bank has slashed floating home loan rates to 7.50 per cent for upto 10 years while pegging it at 7.75 per cent for 10-20 year maturity.

The interest rates have been slashed by 0.25 per cent to 7.50 per cent for loans upto five years while it was reduced by 0.50 per cent to 7.50 per cent for 5-10 year loans, PNB officials told PTI in New Delhi on Tuesday.

PNB also brought down the floating rates by 1.5 per cent to 7.75 per cent for 10-20 year loans.

Although the new rates are valid till December 31, 2003, PNB officials said it could be extended depending on the response to the offer.

The bank is also offering a "repayment holiday" of 18 months but borrowers have to pay the interest component during this period.

"This offer translates to a equated monthly installment of Rs 625 per lakh during the repayment holiday for loans repayable upto 10 years," they said. The EMI works out to Rs 646 per lakh for 10-20 year loans.

PNB also decided to waive the upfront and documentation fees as well.

The bank plans to aggressively increase its home loan portfolio by tying up with corporates.