RBI Governor D Subbarao rules out SLR cut

PUNE: RBI Governor D Subbarao today ruled out reduction in Statutory Liquidity Ratio (SLR) at present, saying the existing conditions did not favour such a decision.

"SLR cannot be reduced at the moment because there are a number of pre-conditions to such a decision which cannot be met," he said, addressing a convocation at National Institute of Bank Management (NIBM) here.

Rao said the Indian banks' exposure to government debt was high, and it would remain so given the country's high fiscal deficit.

"The challenge before the country's banks is to brace up for participating in the multi-billion rupee infrastructure investment lined up in the 12th five year plan," he said.

Therefore, he noted, banks would have to "closely examine" their asset-liabilities balance.