In fact in its last tranche of bonds issued in May this year, ICICI had decreased the interest rates to 12.75 per cent on a five-year regular bond against the 13.75 per cent it had offered in its previous issue in March, 1999. The domestic financial institution had also reduced the tenure of many of its instruments from five years to three years, while the rates on these were reduced by 25 basis points to 50 basis points.

"We usually fix the interest rates just before the issue and we take intoaccount the rates being offered by other institutions such as Unit Trust of India (UTI), Housing Development Finance Corporation," a senior ICICI official said. This year, UTI has also reduced the rate on its monthly income plan to 10.75 per cent from the 12 per cent offered in earlier issues.

In another major change in its strategy, ICICI will also be cutting down its loan exposure to manufacturing projects further this year. Last fiscal, loans to manufacturing projects accounted for only 25 per cent of its disbursals compared to 66 per cent in the previous year. And with the low demand for foreign currency loans among corporates this year, ICICI may not access loans abroad during the year, officials said. ICICI is also planning `safety centres' all over the country to intensify its retail services, the ICICI official said adding that 70 such centres would be opened this year.

"These centres, to be operated by ICICI staff and will cater to the needs of the investors who have invested in its safetybonds," the official said.