‘Lending rate to remain unchanged till monetary policy’

April 17th, 2008 - 10:44 pm ICT by admin  

Mumbai, April 17 (IANS) Indian bankers will wait for the monetary policy before announcing any change in the prime lending rate (PLR) in the wake of the hike in cash reserve ratio (CRR), announced by the apex bank Thursday. M.V. Nair, chairman and managing director of Union bank of India, told IANS: “We will wait for the announcement of the monetary policy and take a decision on the revision of PLR rates.”

Echoing the same sentiment, Chanda Kochhar, joint managing director of ICICI, said: “I do not think we have to go for a knee jerk reaction to the CRR hike. We will have to see whether interest rates would move up. If so, credit volume will go down, but for that we have to wait for the policy.”

M.B.N. Rao, chairman of Canara Bank, also felt that most of the banks would adopt wait-and-watch policy before declaring any change in the existing PLR.

“There is a possibility of borrowings go down if the interest rates go up,” Rao said.

However, N. Daruwala of Central Bank of India, accepted that there was all possibility of higher lending rates to come in the times ahead.

“Inflation has to be contained. As of now, none of us can say what is going to happen,” Daruwala said.

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