The Hindu Business Line : Union Bank chief sees no reason for rate hike

I DO not see any valid reason why interest rates should harden in the immediate future," Mr K. Cherian Varghese, Chairman and Managing Director of the Union Bank of India, said.

With core inflation under control, adequate liquidity in the market and the Finance Minister, Mr P. Chidambaram's assurance that Government borrowings this year will be less than last year, the interest rates can be effectively managed, Mr Varghese said.

Announcing the launch of the national scheme to promote milk production and rural employment generation, he said that the bank had distributed 300 Union White Cards to women in Thrissur district, with a credit dispensation of Rs 1.5 crore. The cattle are insured under the scheme and there is also a buy-back agreement for the milk with a local dairy company.

Regarding mergers, Mr Varghese said that creation of banks of international stature through mergers would reduce cost of operations and build up capacity to do global business.

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