SBI to hold home loan rates

RBI's lowering of borrowing limit must have led to the decision

The State Bank of India (SBI) will hold on to its home loan rates, a senior official of the bank said here today.

"Home loan rates will remain as they are," SBI Chairperson and Managing Director Arundhati Bhattacharya said on the sidelines of the IIM Calcutta's 49th convocation.

The RBI on Tuesday kept policy rates unchanged but lowered the borrowing limit for the banks from the overnight facility.

A lowering of borrowing limit is likely to translate into increase in cost of funds for the banks.

"Cost of funds will go up but we are not considering any hike in the home loan rates," she said.

Some of the banks like the Indian Bank have increased base rates marginally a few days back.

The bank was open to any idea for reaching a solution regarding Haldia Petrochemicals.

"We are trying to work out a solution and we are open to any idea that gives us a solution," she said.

Earlier, Bhattacharya had said that the HPL asset will not turn bad. The troubled company has a potential of very good profitability if it runs at more than 80% capacity. The company is facing financial crunch for long and is on the verge of knocking the doors of Board of Financial Reconstruction.