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New Delhi, April 18: : Borrowers for homes and cars can enjoy the stable interest rate regime for some time now as banks are not going to hike interest rates before the Reserve Bank's annual credit policy, scheduled for April 29.
Ruling out any possibility for jacking up interest rates due to 0.5 per cent CRR hike announced by the RBI on Thursday, country's leading bankers said they would wait for the annual policy.
Many financial institutions have started evaluating their liquidity positions, in the wake of RBI decision to raise Cash Reserve Ratio -- percentage of deposits that banks have to keep with the regulator -- to eight per cent from 7.5 per cent earlier.
ICICI Bank Managing Director and CEO K V Kamath said, "we will see as we go along. We are all working in a market place. We have to understand market. For that we need next..." HDFC Chairman Deepak Parekh said the company has not yet taken a call on its interest rates.
With the 50 basis point hike in CRR, margin of banks would be squeezed by 3-4 per cent. "There is going to be profitability impact on banks, that I think is given because whatever is kept aside as CRR, you are not going to get interest on it," Kamath said.
Punjab National Bank Chairman and Managing Director K C Chakrabarty said "we have to see how we can cope up with the situation...immediately nothing is going to happen." Most of the banks would take a call on interest rates after the annual credit policy, which would give the clear monetary stance for 2008-09, he said.
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