UBI Cuts Home Loan Rates By 50 bps

United Bank of IndiaUBI has abbreviated interest rates on home loans up to Rs 20 lakh by 50 basis points wef May 7.

M V Nair, chairman and managing director of the bank told, “We have taken this step following the Reserve Bank of India's step in the monetary policy to reduce the risk weight on housing loans below Rs 20 lakh. This will be with immediate effect.”

Bank’s total exposure towards the housing segment is Rs 4,465 crore.

“We are targeting a growth of 25 per cent in home loans for the year,” Mr. Nair added.

Now the bank will charge a fixed home loan rate of 10.75 per cent for loans up to 5 years. Floating rates would be 10 per cent for 5 years, 10.5 per cent for 5-10 years and 10.75 per cent for above 10 years.

Through upper Tier-II and perpetual bonds, the bank aims to raise Rs 1,500 crore by the next two years.

The bank recorded 57.24% increase in its net profit for the quarter ended March 31, at Rs 228 crore, while its full year earnings climbed up 25.19per cent to Rs 845 crore. RBI has also sanctioned its plan to open branches at Hong Kong and representative offices at Beijing and UAE.

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