SBI may review rates by May-end

Kolkata, May 8 (IANS) State Bank of India (SBI), the country's largest lender, may review rates by May-end as it has seen a steady rise in deposits last fiscal, a top official said here Friday.

'Our deposits are growing at fantastic rates; we see an excess of supply over demand,' SBI chairman O.P. Bhatt told reporters on the sidelines of the inauguration of the bank's inward remittance division.

'We will see if further tweaking of deposit rates is required,' he said, adding that in 2008-09 the bank increased its market share of deposits phenomenally.

'Our increase in the market share of deposits last year was the highest seen by any bank anywhere and we are currently getting $200 million a day,' Bhatt said.

Asked if the bank was planning to cut its prime lending rate (PLR), he said SBI's lending rates were the 'lowest in the industry'.

'Tell me which segment of loan offered by SBI is not cheaper than the industry levels?' he asked.

However, Bhatt expects interest rates to fall further.

'In general, there seems to be a softening of interest rates on deposit and advance sides,' Bhatt said.

Talking about the credit demand, Bhatt said the prevailing sentiment was resisting credit offtake.

'I am today giving the cheapest home loan at 8 percent but still people are not coming forward as they expect interest rates to fall further,' he said.