The country’s largest lender State Bank of India (SBI) might be continuing its teaser rates for home loans but has hiked its rates for short-term corporate loans by 0.25-50 basis points.
?With surplus liquidity gradually disappearing from the system, we have re-priced certain segments of our short-term corporate loans by 0.25-0.50 bps upwards, he said. SBI chairman OP Bhatt, however, said that the bank is unlikely to increase its deposit rates soon and agreed that liquidity is here to stay in the system. SBI said the public sector entity will be shelling out close to Rs 18,000 crore for 3G auctions.
?We have got requests and demands for that kind of money. At the maximum we will lend Rs 18,000 crore. Having said that, we are still having a surplus liquidity of Rs 26,000,? said Bhatt. On an average there is still a fair amount of liquidity in the system. If you see, the 10-year government security bond is close to 7.40%. There is not much pressure on the liquidity at the moment. It is too early to say if the impact on liquidity will have a temporary or a permanent impact on the liquidity condition,
Meanwhile, Union Bank of India CMD MV Nair said the bank would be giving out Rs 2,000 crore for 3 G auctions. ?Liquidity will not be impacted with the money flowing out as we already sitting on adequate liquidity,? he said. Talking about bad loans, Bhatt said NPAs have started coming down in the last few quarters and that the worst is over. On the recent credit growth numbers, Bhatt agreed that credit growth is not picking up well and it can be due to the slack season.
?Usually in April there is always a negative growth. So it is too early to say if it is because of the slack season or if there is more to it,? he added.