Foreign lender, Citibank announces a 50 basis points cut in its mortgage prime lending rate (MPR) to 13.75% from April 1st.

The reduction in the MPR is likely to benefit all the existing customers of the bank, said a press release by Citibank.

"The percentage of revision for loans on variable rates will be 0.5 percent and the advantage of this downward revision will be passed to all existing mortgage customers with floating rate loans from April 1, 2009," added the release.

A spokesperson from Citibank said that the borrower could get a loan at up to 50 basis points lower than the benchmark rate depending on the loan amount, tenure and the customer's relationship with the bank.

Earlier the bank made a similar revision of 50 basis points in MPR in January 2009. The present cut comes immediately after the government expressed discontentment on the inadequate response from these lenders to RBI's recent cut in the policy rates.

Although RBI has been following an easing monetary policy to increase the flow of credit yet the foreign and private banks have not cut their rates.

On the other hand, the PSU banks have responded to the repeated cuts made by the RBI and slashed their interest rates. Presently also almost all the public lenders have reduced their benchmark prime lending rates soon after the RBI made an announcement of cut in the key policy rates.