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SBI to decide on interest revision next week

SBI to decide on interest revision next week
PTI
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First Published: Fri, Aug 03 2007. 05 28 PM IST
Updated: Fri, Aug 03 2007. 05 28 PM IST
Mumbai: India’s largest lender State Bank of India (SBI) will decide on a revision of interest rates next week when its asset-liability committee (ALCO) meets to take up the matter, a top bank official said today.
“Interest rates have peaked and there is no possibility of them going higher but will they remain stable or come down, we will have to take a decision at our ALCO meet,” SBI Chairman O P Bhatt told reporters here.
On the Reserve Bank’s raising the cash reserve ratio (CRR) by 0.5% during its July 31 monetary review, Bhatt said the hike would result in a total outgo of Rs 2,400- 2,500 crore from the bank.
Its margins would also be impacted by 0.05%, Bhatt said.
“The CRR hike will not have much of an impact. We will try to cut our expenses or increase our income to offset this,” the SBI Chairman said.
The bank will create a holding company for its mutual funds and life insurance businesses in the next 3-4 months, he said, adding that “it is an internal restructuring.”
“We will dilute 5-10% to strategic investors for price discovery purposes,” he said.
On plans for a follow-on public offer (FPO), Bhatt said no decision has been taken on fund-raising.
“We expect to finalise our plans within this month,” he said.
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First Published: Fri, Aug 03 2007. 05 28 PM IST
More Topics: SBI | O.P. Bhatt | interest | revision | Money Matters |