State Bank of India (SBI) has decided to go for a cut in lending rates for loans to SMEs and retail sector including the loans for automobiles to benefit lenders in these segments.
State Bank of India (SBI) has decided to go for a cut in lending rates for loans to SMEs and retail sector including the loans for automobiles to benefit lenders in these segments.
"We have already started adjustment of rates on the loan side. Auto loan rates will be cut today or tomorrow. This will be flowed by a reduction in the rates on smaller ticket loans to small and medium enterprises,’’ said A Krishna Kumar, Managing Director, (SBI) to the media here on Saturday.
The move has come into effect post government’s decision for banks to reduce their lending rates following the 50 basis points cut in the repo rate by the Reserve Bank of India (RBI) on April 17.
“Bank’s net interest margins would not be impacted as about 47 per cent of deposits were under current accounts and savings accounts,” added Kumar over the probable impact of the rate cut on its profits.
For SBI, it is unlikely to reduce the base rate further as it already has the lowest figure among the banks.
ICICI Bank, IDBI Bank and Punjab National Bank are some of the banks who have already reduced their lending and deposit rates by 25 basis points.
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