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PNB may increase PLR by up to 0.5%

PNB may increase PLR by up to 0.5%
PTI
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First Published: Wed, Apr 04 2007. 04 06 PM IST
Updated: Wed, Apr 04 2007. 04 06 PM IST
New Delhi: Country’s second largest public sector lender Punjab National Bank (PNB) said on 4 April it might increase Prime Lending Rate in the range of 25 to 50 basis points, but no decision has been taken yet.
“We have not taken any decision but there could be a case for hike in PLR by 25 to 50 basis points,” PNB Chairman and Managing Director S.C. Gupta told reporters here.
The decision about rate hike would be taken after reviewing market situation, he said adding the ALCO (Asset Liability Committee) of the bank will take a call in a week.
Currently, the PLR of the bank stands at 12.25% which was last raised in February.
Interest rates on consumer loans have been raised recently but home loan have been left untouched for some time, he said.
As RBI tightened money supply to tame high inflation by hiking its short-term lending (repo) rate by 0.25% and raising cash reserve ratio by 0.50% to suck out about Rs19,500 crore from the system, cost of funds for banks has been pushed up.
Following the RBI’s decision major private sector banks like HDFC and ICICI Bank have already raised their rates by 1%.
Talking about performance of the bank in 2006-07, Gupta said: “We expect to exceed the total business target of Rs2,35,000 crore.
“We are hopeful of surpassing all the parameters declared in the statement of intent filed with the Finance Ministry,” he said, adding for the current fiscal, the bank will revise the business growth target by 20%.
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First Published: Wed, Apr 04 2007. 04 06 PM IST
More Topics: Money Matters | Currency |