Three public sector lenders, including Andhra Bank, raised their base rates or the minimum

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lending rates by up to 50 basis points making housing, auto and other loans more expensive.

The bank has decided to raise its base rate by 25 basis points to 10.25 per cent from 10 per cent effective from tomorrow, Andhra Bank said in a statement.

Besides, the bank has raised its Benchmark Prime Lending Rate (BPLR) by 25 basis points as well to 14.50 per cent, making existing loan expensive by at least 25 basis points.

Meanwhile, the largest associate bank of SBI, State Bank of Bikaner and Jaipur raised its base rate by 50 basis points to 9.75 per cent from 9.25 per cent.

Another associate bank, State Bank of Mysore, however, raised its base rate by 25 basis points to 9.75 per cent.

Rate hikes by banks comes in response to interest rate increase by the Reserve Bank last month in its mid-quarterly review of credit policy 2011-12.

The RBI hiked its key short-term lending and borrowing rates by 25 basis points (0.25 per cent) each with immediate effect to tackle inflation.

The short-term lending (repo) rate now stands at 7.5 per cent and the borrowing (reverse repo) rate at 6.5 per cent.