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SBI today ruled out any interest rate cut for its borrowers, even as the RBI chided banks for not having passed the full benefits of the last three reductions in its policy rate.
SBI Chairperson Arundhati Bhattacharya said any rate cut by the bank would depend on many factors, including credit growth, and she does not see any room for a cut in the near future.
This came soon after the Reserve Bank kept its policy rates unchanged, with Governor Raghuram Rajan saying that headline inflation was at elevated levels and banks were yet to pass on the full benefits of the previous rate cuts.
RBI has cut the rates thrice so far in 2015, by 25 basis points each.
Rajan, who has used strong words against banks for holding on to rates in April and June, today said banks have only cut 0.30 per cent at the median level as against the RBI s cut of 0.75 per cent this year.
Commenting on this, Bhattacharya defended SBI’s position and said the bank had raised the rates by 30 basis points only when RBI had hiked the policy rate by 75 basis points, and the reduction in the bank’s rate has also been 30 basis points when the central bank has cut the policy rate by 75 basis points.
She, however, added that RBI’s action was on expected lines and it was good that the central bank has retained a dovish stand.
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