Press Trust of India / New Delhi Feb 09, 2010, 18:16 IST
Country's largest lender SBI today asserted that the Reserve Bank has not objected to "teaser" home loan rates, which had kicked up a storm in the industry.
Banks, led by State Bank of India, under special schemes offer home loans at lower interest rates for the first few years of the credit period, which is referred to as "teaser" rates.
"They (RBI) have not not objected.... SBI would not do anything which RBI objects...No RBI has not objected," SBI Chairman O P Bhatt said here.
The RBI has been worried about teaser rates as it is concerned that borrowers may find repayment difficult once the interest rates go up.
RBI Deputy Governor Usha Thorat had said: "Teaser rates by banks is a cause of concern. Banks must ensure that borrowers can service higher rates when rates return to normal."
Yesterday, Thorat in response to further progress on the regulatory front on teaser rates had said, "Banks should have taken whatever message was given."
Country's largest private sector lender ICICI Bank had also recently said the main issue about teaser rates is the transparency.
Customers should know exactly what these rates are, ICICI Bank MD and CEO Chanda Kochhar had said.
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