What are the factors that a bank would consider to determine its lending rate?

What are the factors that a bank would consider to determine its lending rate?
Average interest paid out on deposits and expenses
Minimum expected profit from lending operations
Degree of risk in lending – specific to a borrower, depending upon his business
The minimum rate of interest on loans would be 7% + 3% + 1% = 11%. This is the lowest interest that any bank offers now in India on loans. There is a specific name for this rate. It is referred to as “Prime Lending Rate” or PLR. The bank would add further to this rate depending upon risk etc., which is called “risk premium” . This would again be different from borrower to borrower.