SBI hints lending rate hike moving ahead

MUMBAI: State Bank of India today hinted a hike in its lending rates moving ahead while its nearest competitor ICICI Bank said it would assess the market conditions prior to taking a call, following today's RBI action.

"The signal from the Reserve Bank is that money is going to be costlier," SBI Chief Financial Officer, S S Ranjan told PTI here.

Ranjan, however, hinted that the bank is unlikely to increase its lending rates at least in the remaining part of this fiscal and would evaluate market conditions prior to taking any decision.

The bank's ALCO is likely to meet very soon to take stock of prevailing market conditions following the apex bank's rate action, he said.

Ahead of the annual policy next month, the RBI today hiked its repo and reverse repo rates (short-term lending and borrowing rates) by 0.25 per cent to 5 per cent and 3.5 per cent, respectively.

Expressing a similar view, ICICI Bank's Managing Director and CEO, Chanda Kochhar, said that the bank would assess the market situation before taking a call on any rate revisions.

"Currently, there is ample liquidity in the market. We need to wait and see the credit offtake and systemic liquidity to assess the mediumterm impact on lending and borrowing rates," Kochhar said.