After credit growth, SBI to cut rat

State Bank of India (SBI) chairman Arundhati Bhattacharya on Tuesday that SBI would consider cutting interest rates only when the credit growth picks up momentum. The Reserve Bank of India had lowered the repo rate by 75 basis points during the first half of this year. While keeping the policy rate unchanged during its latest monetary policy review, RBI had asked banks to pass on the full benefits of previous rate cuts.

“Banks cannot be delinked from the economic growth. Credit growth has remained tepid and is yet to take-off. The bond yields have to come off and there should be a repricing of deposits. The improvement in all these three factors would give us the ability to transmit the rate cut to final consumers. This will take little more time,” she said while announcing the bank’s June ending quarter results.

The bank reported a 10.25 per cent growth in its net profit to Rs 3,692 crores in Q1FY16. Its gross NPA dropped to 4.29 per cent during the quarter, while net NPA stood at 2.24 per cent as against 2.66 per cent reported a year earlier.