The meeting was held on the eve of the mid-term review of the RBIs annual monetary policy to be announced on October 24.
The delegation was led by IBA chairman, TS Narayanasami who is also the chairman and managing director of state-owned Bank of India. The bankers present at the meeting on Monday included State Bank of India chairman, OP Bhatt, Canara Bank CMD, AC Mahajan, Union Bank of India CMD, MV Nair, Bank of Baroda CMD, MD Mallya and Axis Bank chairman & CEO, PJ Nayak and Citi India CEO, Sanjay Nayyar.
Bankers are of the view that though tightening of liquidity seems to have eased since the RBI pumped in money through liquidity adjustment facility (LAF). Still, they pleaded for further reduction of statutory liquidity ratio (SLR). RBI can either cut SLR by 1% on an incremental basis or increase the borrowing facility to the same extent.
The meeting was the first in a series, where the new RBI governor interacted with the top brass of various banks including rural regional and urban co-operative banks on the eve of the credit policy review.
On credit offtake, which witnessed a growth of more than 24-25% much above the RBIs projections of 20%, IBA is of the view that mostly the pick-up has happened in government-owned sectors including oil and fertiliser. In contrast, there was a slowdown of credit offtake in areas like retail and agriculture. The managing committee of the IBA had met recently to discuss the issue. The heads of the regional rural banks, urban co-operative banks and the senior officials from Fixed Income and Money Market Association of India (FIMMDA) will also be meeting with the RBI governor shortly as part of series of meetings.