Chidambaram to meet bank chiefs Wednesday

August 11th, 2008 - 8:13 pm ICT by IANS  

A file-photo of P. Chidambaram

New Delhi, Aug 11 (IANS) Finance Minister P. Chidambaram is expected to take stock of the farm loan waiver scheme and the performance of banks during a meeting here Wednesday with chiefs of the 28 state-owned banks in India. Although no formal agenda has been announced, the finance minister is expected to review the banks’ first quarter performance, a news posting on the finance ministry website said.

Chidambaram is also expected ask banks to continue ensuring the flow of home loans and access to low-cost deposits during the meeting.

Recent media reports have speculated that the country’s largest bank, the State Bank of India (SBI), will likely take a decision on hiking its benchmark prime lending rate after the meeting.

While many banks have already hiked their prime lending rates following the recent increase in the amount that banks must hold in reserve (the cash reserve ratio) and the repo rate - the rate at which India’s central bank the Reserve Bank of India (RBI) lends to banks - the SBI has so far refrained from increasing its own benchmark rate.

The RBI increased the CRR and the repo rate July 29 during its quarterly review of monetary policy.

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