'Maintaining LCR, SLR, CRR a drag'

Finding itself in a tight spot on maintaining the liquidity coverage ratio (LCR), State Bank of India (SBI) has suggested leeway for LCR rules since they take away more resources from the deposits base.

Banks have to set aside money out of deposits for Statutory Liquidity Ratio (SLR), Cash Reserve Ratio (CRR) and give loans under priority sector lending (PSL). Over and above this, banks have to follow LCR, leaving only 40 per cent for commercial deployment, SBI Chairman Arundhati Bhattacharya said.

"At this point of time we have to hold certain level of high quality liquid assets (HQLA) to meet LCR norms. They are in the form of government securities. We find that to maintain HQLA, we may have to holds higher level of government bond portfolio than what we currently required to do," she said.

Though seven-eight per cent of SLR can be counted towards HQLA even then the requirement is high. "In effect we are finding that bank will have to maintain SLR of 27-28 per cent," SBI chief said.