Banks expect RBI to raise repo rate again

"We think the RBI will raise the repo rate some more. The banks will react at that time," she said, adding that the SBH would not increase its prime lending rate at present.

According to Challu, inflation has touched the double digit figure after a long time and its impact is being felt by everybody. Liquidity is getting impacted right now. Credit is more expensive and project financing will start feeling some impact. Though corporate banking has not been impacted so far, the credit offtake in the personal banking segment has slowed down in the past two months. 

Challu, who took charge as the MD of SBH on Monday, is the first women to head the 67-year-old financial organisation.  If the current proposal to merge SBH with the State Bank of India is implemented during her tenure in the next three years, she could as well be the last one to head the bank, which was set up by the Nizam of Hyderabad in 1941.

As the head of SBH, her agenda would be to focus on all segments of the bank, leverage technology and provide customised solutions. She would be adding 50 more branches this year to the bank's existing network of 1,158 branches across the country. The number of ATMs would also be increased from the existing 510 to 760.

In an informal meeting with journalists who called on her on Tuesday, Challu said she was also looking at increasing the non-fund-based income of the bank and focus on corporate internet banking to a large extent.