The biggest lender of the country, State Bank of India has hiked interest rates on short term corporate loans by 25-50 basis points. O P Bhatt, Chairman of SBI said, “With surplus liquidity gradually disappearing from the system, we have re-priced certain segments of our short-term corporate loans by 0.25-0.50 bps upwards.”
Public sector banks, Canara Bank has intentions to venture into the northern part of India. The bank has a significant customer base of more than 37 million and has a strong presence in the southern part of India. It intends to start highest number of its intended 200 branches in the north this fiscal.
Leading car manufacturer Maruti Suzuki has posted a 27.9% increase in sales for May at 102,175 units as against 79,872 vehicles. This was made possible by cheap car loans
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PSU banks are looking to offer more personal loans to the customers in order to raise thir margins and profitability. This is because the returns from personal loans are higher than any other kind of loan.
The monetary policy announced some time ago had included some monetary tightening steps like increase in the cash reserve ratio (CRR) and in the repo and reverse repo rates. The RBI has taken these steps to regulate the rising inflation rates of the country.
Private sector bank, Axis Bank is planning to raise its retail loan book such that it comprises 25% of the total loan book of the bank over the next 2 years. This means the bank plans to increase its focus on personal loans.
With the base rate being implemented over the next 2 months, all banks are ready to compute their base rate which would be eliminating the benchmark prime lending rate (BPLR) totally from the loan pricing system of Indian banks. The base rate is coming into effect from 1st July 2010.
Sundaram BNP Paribas Home Finance, a
The request by some banks for getting the freedom to fix borrower specific base rates for car loans has been shot down by the RBI. The banks are not even permitted to charge negative premium while computing the effective base rate.