Business Daily from THE HINDU group of publications
Wednesday, Aug 01, 2007
ePaper
Business Daily from THE HINDU group of publications Wednesday, Aug 01, 2007 ePaper |
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Money & Banking
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Credit Policy ‘A correct measure’
Our Bureau Mangalore, July 31 The Chairman and Chief Executive Officer of Karnataka Bank Ltd, Mr Anantakrishna, has said that the RBI’s measure to increase the Cash Reserve Ratio (CRR) by 50 basis points is really required. He told Business Line: “We believe that it is a correct measure.” During the first quarter of this year, there has been a credit decline by about Rs 35,000 crore. Liquidity was available. Liquidity should not trigger inf lation could be the reason for this increase, he said. Asked if the move would affect the profitability of banks, he said this could affect to a certain extent, not to a major extent. To a query whether Karnataka Bank will increase deposit and lending rates, he said: “For the time being we do not want to increase lending or deposit rates.” ‘RBI strikes balance’
Mr B. Sambamurthy, Chairman and Managing Director of Corporation Bank, said that the RBI has struck a balance between CRR and reverse repo. Stating that call rate could be pushed a little, he said it may come back to the corridor between the repo and reverse repo. Asked if the bank will resort to increasing lending and deposit rates, he said: “So far as our bank is concerned we are not doing any thing for the moment for a month or so. We will see how the things develop.”
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