The reduction in lending rates may prompt increase in credit offtake which has moderated substantially putting burden on balance sheet of banks.
Home loan rate for ICICI Bank will come down between 0.45 and 0.6 per cent depending on quantum and category.
Another private sector Kotak Mahindra Bank too reduced the MCLR rate by up to 0.45 per cent.
The bank has reduced MCLR by 0.20 per cent to 9 per cent from 9.20 per cent for 1-year tenor, Kotak Mahindra Bank said in a statement.
However, MCLR for the three-month period has been reduced by 0.45 percentage points to 8.40 per cent while lending rate for 2 and 3 years has been brought down to 9 per cent from 9.25 per cent.
