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One of the nation's largest banks cut its prime lending rate by a steep 0.5 percentage point to 9.5 percent today, two days after the Federal Reserve lowered one if its key lending rates in an effort to prevent the recession from deepening.

First National Bank of Chicago, the 13th-largest U.S. banking company, said it would lower its prime rate from 10 percent effective immediately.

Earlier in the month, a handful of regional banks -- including M&T Bank in Buffalo -- took a more cautious step by easing their prime rates to 9.75 percent, but analysts said larger institutions were waiting for a cue from the Fed before following suit.

The recent decline in the prime rate, which serves as a guide for bank lending charges for a host of business and consumer loans, marks the first cut in the rate in nearly a year.

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