RBI effect: Bankers refuse to cut interest rates
They, however, indicated that interest rates could drop over a period of time.
After the RBI policy announcement in which cash reserve ratio was cut by 0.25 per cent, leading bankers said this measure will not have any significant impact on their cost of funds.
"Lending rates are not going to come down immediately, though the rates may fall over a period of time," ICICI Bank Chief Chanda Kochhar told reporters during the customary post-policy media briefing.
State Bank of India was a bit accommodative, saying its asset liability committee (Alco) will meet in a day or two.
"I prefer a secular reduction in lending rates with a cut in the base rate. We have already passed on the previous CRR cuts to the borrowers. However, our Alco will be meeting in a day or two take a call on lending rate cuts," SBI Chairman Pratip Chaudhuri said.
On impact of the 13 successive rate hike by the central bank through March 2010 to October 2011, Chaudhuri said: "I do not think the 13 rate increases that happened helped in slowing inflation because today's inflation is largely due to cost push, and not so much demand-pull. Trying to address that with rate of interest as an instrument may not be very good."
On impact of the 0.25 per cent CRR cut on SBI's cost of funds, he said, it will release Rs 225