SBI mulls hike in lending, deposit rates

New Delhi, Nov 17 | Updated: Nov 18 2005, 05:30am hrs
Most banks are examining the interest rate situation to take a decision on hiking lending and deposit rates following the Reserve Bank of Indias decision to raise short-term rates in the credit policy in October.

Addressing reporters on the sidelines of a Saarc business conclave organised by Ficci, State Bank of India chairman AK Purwar said, After RBI raised the repo and reverse repo rates by 0.25% each, there is definitely an upward pressure on short-term rates.

He added that SBI would soon take a decision on raising the short-term lending and deposit rates.

Mr Purwar also said SBI has no fixed target for buyouts abroad. The bank is planning to raise $2 billion from the overseas market as part of its medium term note programme. A large part of the fund would be used for acquisitions and expansion of its overseas business. It has evinced interest in setting up a branch in Pakistan as well.

Speaking at the seminar, Mr Purwar underlined the need for integration of the financial sector in South Asia.