Overview:
- In August 2023, outstanding deposit rates increased while outstanding lending rates remained flat. Meanwhile, rates on fresh business climbed.
- The weighted average lending rate (WALR) on outstanding rupee loans of scheduled commercial banks (SCBs) remained flat sequentially, however, the weighted average domestic term deposit rate (WADTDR) on o/s rupee term deposits increased by 5 bps from 6.55% in July 2023 to 6.60% in August 2023.
- One-year median Marginal Cost of fund-based Lending Rate (MCLR) of SCBs increased from 8.60% in August 2023 to 8.70% in September 2023.
- The WALR on fresh rupee loans of SCBs increased sequentially by 3 basis points (bps) to 9.47% in August 2023 from 9.44% in July 2023, while on WADTDR (Fresh) SCBs increased marginally by 1 bps from 6.35% in July 2023 to 6.36% in August 2023.
- The spread of SCBs between WALR and WADTDR (the net interest rate spread) stood at 3.11% and 3.22% for Fresh and Outstanding rates, respectively in August 2023. PVBs continue to maintain a higher spread as compared to PSBs. The o/s SCB spreads have been compressing over the last year and have reached to an 8-year low.
