EMIs set to come down, banks to cut lending rates on RBI rate cut, say bankers Pratip Chaudhuri, Chanda Kochhar
Borrowers can now look forward to their EMIs coming down soon as leading bankers today said they will pass on the benefit of RBI reducing its short-term lending rate and cash reserve ratio to customers.
Bankers, however, did not say by how much or how soon they will reduce their lending rates.
Stating there is room for monetary transmission, State Bank of India Chairman Pratip Chaudhuri said, "The overall cost of funds gets lowered by Rs 300 crore following the CRR cut which we will pass on to our borrowers without compromising on the Net Interest Margin (NIM).
"But how and in which pocket will it be, would be decided soon. Our ALCO (risk management committee in banks) will be meeting tomorrow to finalise the details," Chaudhuri told reporters here.
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Indicating a cut in base rate, Chanda Kochhar of ICICI Bank said there is going to be a transmission on the lending side, while on the deposits front, it will wait and watch.
"There is going to be a lag but we will not take a hit on NIM. The cuts are positive for EMIs."
Hinting that her bank has no immediate plan to lower deposit rates, she said, "it is not necessary to assume that deposit rates will come down with reduction in the lending rates."
HDFC Bank Managing Director and Chief Executive Aditya Puri said, "The 25 bps reduction in the CRR will benefit us to the tune of Rs 70 crore and there will be
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