According to the Finance Minister P Chidambaram, all PSU banks have agreed to cut prime Lending Rate by 75 bps. Chidambaram held a meeting with top executives of PSU banks on 4th November 2008, to review liquidity situation and performance of the lenders. He, however, maintained no directive has been given to banks to cut the rates.
He also informed that IBA (Indian Banks Association) has assured to review price of credit to sectors and also banks have been asked to assess additional capital needs. Liquidity has been considerably enhanced on RBI steps. The Finance Secretary and the RBI governor would meet the chiefs of private banks tomorrow. A few public sector banks have already announced their decision to cut rates. Bank of Baroda would reduce lending rates by 75 bps on November 5 while Vijaya Bank may cut lending and deposit rates later this week.
He also informed that IBA (Indian Banks Association) has assured to review price of credit to sectors and also banks have been asked to assess additional capital needs. Liquidity has been considerably enhanced on RBI steps. The Finance Secretary and the RBI governor would meet the chiefs of private banks tomorrow. A few public sector banks have already announced their decision to cut rates. Bank of Baroda would reduce lending rates by 75 bps on November 5 while Vijaya Bank may cut lending and deposit rates later this week.
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