New Delhi, Jan. 18 (PTI): HDFC Bank will slash interest rates on cars and commercial vehicles by up to 150 basis points from tomorrow.

The bank will also cut interest rates on corporate loans and wholesale credit which will benefit small and medium enterprises and large firms.

Car and commercial vehicle loans will become cheaper by 125 basis points, while interest on two-wheeler loans will be reduced by 150 basis points, HDFC Bank head (retail assets and credit cards), Pralay Mondal said.

The bank will reduce interest rate on personal loan by 75-100 basis points from the existing 17-17.5 per cent.

“We have been able to pass on such a massive reduction to customers as cost of fund has eased and it is slated to come down further in the coming months,” Mondal said.

The bank is doing it as a pre-emptive measure, which will give a fillip to the slackening auto sales, in particular, and the SME and manufacturing sector, in general, he said.

The slowdown has badly hit auto sales, which declined 18.2 per cent in December because of a fall in the sales of commercial vehicles and two-wheelers.

The across-the-board rate cut by the bank comes in less than 20 days of reduction of its prime lending rate by half a percentage point.

At present, HDFC Bank offers car loan at 13.5-14 per cent and commercial vehicle loans at 14.5-15 per cent. Credit for two-wheelers attracts a 24-24.5 per cent interest rate. Mondal said, the interest rate on loans against properties would come down sharply by 150-200 basis points, while for credit against securities the cut would be one per cent. The existing rates for such credit varies between 13.75-15.25 per cent.