Bank of Baroda says status quo on rates will be maintained

To pass on cut in lending rates if cost of deposits comes down

Bank of Baroda – country’s second largest lender said that as of now status quo would be maintained on lending rates and it is ready to pass on the cut in lending rates if cost of deposits comes down.

S S Mundra, chairman and managing director, Bank of Baroda said, “bank has been passing past policy action to selective segments and the rates for retail and micro, small and medium enterprises (MSME) have come down.”  Mundra was reacting to Reserve Bank of India’s decision to keep the policy rate and cash reserve ratio (CRR) unchanged at 7.25% and 4% respectively.  

Bank of Baroda recently started offering home loans irrespective of tenure and amount on base rate which is at 10.25% currently.   

Mundra further said that, “we would be carefully watching trajectory of our ability to contain the cost of deposit and that would determine our future viewpoint on lending rates.” According to Mundra as a bank it has to meet the depositors’ expectations too and any softening in deposit rates would be definitely passed to the borrowers.