LIC Housing Finance, Punjab National Bank and Oriental Bank of Commerce have hinted at hiking interest rates across the board, including on home loans, following RBI's decision to raise key short term rates today.

"We have little choice other than hiking the home loan rates," LIC HF CEO S.K. Mitter said.

"I cannot have a shrinking margin... we will review lending rates within a few days," OBC Chairman K.N. Prithviraj said, hinting that a rate hike acorss the board, including home loan rates, could be considered.

He said the 0.25 per cent hike in short-term rates is going to increase the cost of funds for the banks.

"There is no way banks can adjust, as we have to protect the net interest margin," he added.

Punjab National Bank's retail head U.S. Bhargav said banks used to depend on the low-cost funds from the RBI, with that gone, banks have two options left either to increase low-cost deposit mobilisation or hike lending rates.

He said PNB Board would meet on July 31 to review the lending rates, including home loan rates.

Meanwhile, the Boards of country's top two lenders SBI and ICICI Bank were reviewing the RBI's decision.

Indications are that both banks will pass on the rate hike to customers as cost of funds are going up.

Yes Bank, a new generation private bank, has announced that it will raise its prime lending rate (PLR).

LIC Housing Finance said interest rates are on the rise for the last 12-15 months and may affect the volume of lending.

An ICICI Bank official said: "We were anticipating a rate hike by the RBI. The bank will take a call on the rates soon." Indications are that the bank may raise home and auto loan rates.

Private sector IndusInd Bank Managing Director Bhaskar Ghose said the RBI's decision would have an impact on short-term loan rates, "which could go up by 25 bps". IndusInd Bank will take a decision on its rates within a week, he said.