Different strokes: All banks may not cut lending rates because costs are down

.......Banks may react differently to RBI’s rate tweaks on Friday because they aren’t all affected in the same way. This is because base rates, to which all lending rates are linked, are more a function of deposit rates than policy rates. How banks will react depends on three factors. One, there are the savings they make on their incremental funds. Banks such as YES Bank and IndusInd Bank, which rely a lot on short-term deposits, may reap the most savings in cost from RBI’s tweaks........

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