File photo: Arundhati Bhattacharya who heads SBI

Mumbai:  State Bank of India, the country’s biggest lender by assets, today announced cut in its lending rates by 90 basis points for maturities ranging from overnight to three-year tenures, after experiencing a surge in deposits. With this SBI’s so-called overnight marginal cost of funds-based lending rate (MCLR) fell to 7.75 per cent from 8.65 per cent, while three-year loan rates will now be 8.15 per cent from 9.05 per cent previously. Lending rates were also cut across other maturities effective Sunday. Banks have received an estimated Rs 14.9 lakh crore ($219.30 billion) in old 500, and 1,000 rupees notes from depositors since the government on November 8 banned the banknotes in a bid to fight counterfeiting and bring unaccounted cash to the economy. Such development had raised expectations banks would have room to cut lending rates, which is seen as vital to increase credit growth and spark a revival in private investments.