×
Home Companies Industry Politics Money Opinion LoungeMultimedia Science Education Sports TechnologyConsumerSpecialsMint on Sunday
×

Bankers seek measures to propel demand; see CRR, repo cuts

Bankers seek measures to propel demand; see CRR, repo cuts
PTI
Comment E-mail Print Share
First Published: Thu, Dec 04 2008. 11 13 AM IST
Updated: Thu, Dec 04 2008. 11 13 AM IST
Mumbai: Bankers have highlighted the slowing credit demand in retail and corporate portfolios as an emerging challenge to the domestic banking system and sought coordinated steps from the fiscal and monetary sides to tackle the issue.
They said the Reserve Bank was likely to introduce a set of measures to propel growth in export-oriented sectors and stimulate demand, which might include a further 0.5-1% cut in the cash reserve ratio and repo rates in the near term.
“Credit demand has declined significantly in many sectors because of the economic slowdown. There is a need to revive the demand,” Kotak Mahindra Bank’s Head of Liabilities K V S Manian told PTI here.
A further cut in CRR could bring down the lending rates of private sector banks, which are yet to respond to the latest round of rate cuts announced last month by the central bank unlike their state-owned counterparts, Manian said.
Following a series of rate cuts in the last two months by the RBI, most Government-owned banks had reduced their prime lending rates by 0.75% and deposit rates by up to 0.5%.
“There is a strong possibility of RBI reducing the CRR and repo rate anywhere between 0.5-1% very soon to infuse more money into the system. This would help banks to extend more credit to corporates,” Axis Bank’s Treasury Head Partha Mukherjee said.
Comment E-mail Print Share
First Published: Thu, Dec 04 2008. 11 13 AM IST
More Topics: RBI | CRR | Repo rates | Bankers | Economy and Politics |