State Bank of India (SBI) plans to reduce the non-performing assets (NPAs) arising from retail loans to below 3% in the current financial year from the present 3.08%, an official said on Tuesday.

?I want to bring down my NPAs (SBI?s) in retail loans to less than 3%, to around 2.75% in this (financial) year,? the official said.??

?The NPA levels are down to 3.08% currently from 3.24% in March. We have also tied up with SBI Cards for the soft recovery process, which involves direct calling to customers in order to speed up the recovery process.? Having gained over 17% market share in the home loan segment, the country?s largest bank now aims to raise this figure to 20% in 2010-11, the official said.

According to a recent report by credit rating agency Icra, as on March 2010, SBI?s home loan market share at 17% is on par with leader Housing Development Finance Corp, with ICICI Bank following with a market share of 13%.

?Our incremental market share in home loans is close to 19%. Not only home loans, we want to increase our market share in auto loans to 18% from 16.75% now. We are planning to increase our sanctions to Rs 5,875 crore from Rs 4,415 crore in the last financial year,? the official said.

SBI has disbursed Rs 600 crore car loans in May and Rs 375 crore in April. Home loans in the first two months of 2010-11 have seen a growth of Rs 2,800 crore from March-end, the official said.

?We are targeting a 31% growth to Rs 22,000 crore in this fiscal.? SBI?s home loan portfolio was around Rs 17,100 crore in the previous financial year.

The bank is offering the teaser, or the special rate, of 8% in home loans as well as car loans for the first year.?

For home loans, the bank charges 9% for the second and third years, while for auto loans it is 10%. Both the teaser rate schemes will be reviewed on June 30. ?We may have to re-price our rates once the base rate is finalised,? the official said.?

?There is a possibility that if the base rate is over 8%, the retail loan rates would be adjusted accordingly.?

The bank is likely to decide its base rate by June 28, the official said. Chairman of the bank OP Bhatt earlier said the base rate would be around 7.5-8.5%.?The Reserve Bank of India has mandated all banks to decide on the base rate by July 1.