Tamilnad Mercantile Bank Limited has informed the Exchange about the Revision in Marginal Cost of Funds Based Lending Rate (MCLR) of the Bank
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Tamilnad Mercantile Bank has revised its MCLR (benchmark lending rate) downward across all tenors, effective July 7, 2025. The overnight and one-month rates were cut by 35 basis points to 7.50%, while the three-month rate fell by 30 bps to 8.30%. The six-month and one-year MCLR rates were reduced by 25 bps each to 8.70% and 9.25% respectively. This uniform rate cut indicates the bank is aligning with the broader softening of interest rates in the banking system, making loans linked to MCLR cheaper for borrowers.
Borrowers with MCLR-linked loans will benefit from lower EMIs or get a window to renegotiate terms. For shareholders, while cheaper loans may support loan growth, the rate cut could compress the bank's net interest margins in the near term. The move signals a competitive lending environment.