The stringent prudential norms clamped for calibrating (read slow down) growth in advances in areas like real estate and personal loans should get a "relook" (read relax) in the light of substantial moderation in credit, according Indian Bank's Association (IBA) Chief Executive H N Sinor. | |
| The Reserve Bank of India has tightened norms to put breaks on lending to certain sectors. If the lending has cooled down, then the review of norms can ensure that they (norms) do not take lending down to the recessionary trend, he said. |
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| The flow of applications (for credit) in the real estate and mortgage sectors have come down, he added. |
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| On the existing deposit rates, Sinor said, "We are not comfortable with the high deposit rates as it puts pressure on margins." |
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| It also limits banks from reducing lending rates. While large corporates with the support of strong balancesheets are able to negotiate for fine rates, small and medium size enterprises are the biggest sufferers, he said. |
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