SBI, ICICI Bank May Not Increase Home and Car Loan Rates
ICICI bank and SBI are not willing to raise the lending interest rates in spite of increasing interest rates in the market. Although, small banks that have low retail deposits may come under pressure.
The managing director of the State Bank of India said, “At present, we are not looking at increasing rates”.
SBI ‘s stand on the rate of interest sets a direction for market as other banks take a hint from it. Although, the monthly payments may rise, if the RBI increases the rates any further.
Presently, the CASA ratio of SBI is of around 45%. Higher the CASA ratio lower the funding costs of banks.
On the other hand, ICICI refused to comment on the story, but it largely depends upon the retail deposits for lending.
Chanda Kochhar, MD and CEO, ICICI Bank, said, “Short term rates have increased, but our incremental short term funds are very small. We will continue to watch market conditions, but with 71% of our deposits linked to retail it should not impact us”.
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