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Bankers ask RBI to hold rates

Bankers ask RBI to hold rates
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First Published: Thu, Jan 14 2010. 10 46 PM IST
Updated: Thu, Jan 14 2010. 10 46 PM IST
Mumbai: Ahead of the Reserve Bank of India’s (RBI) policy review on 29 January, bankers asked the central bank to hold rates. Any hike in interest rate would result in a further slump in credit growth, which is now at 13.66%.
They also asked for special relaxations for extending loans to infrastructure projects so that they don’t have to suffer from asset-liability mismatches.
Banks give long-term loans for projects, but have deposits of comparatively shorter durations.
According to two bankers who attended the meeting, banks also want exemption from capital charges on a special refinance facility they are seeking to finance infrastructure projects.
“We have asked for fine-tuning take-out financing norms of the IIFCL (India Infrastructure Finance Co. Ltd). We don’t want to incur CRR (cash reserve ratio) and SLR (statutory liquidity ratio) charges while taking take-out financing. RBI would be taking up this issue with IIFCL,” said a public sector banker, who did not want to be named.
Banks also asked for relaxation of capital charges when issuing bonds. They also sought relaxation on savings account interest rates. From April, banks have to pay interest on savings accounts daily.
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First Published: Thu, Jan 14 2010. 10 46 PM IST