Crr Cut No Panacea

The position with financial institutions (FIs) is not very different, bankers say. Though FIs have been lending comfortably in the call money market, the impression that they are flush with funds could be quite erroneous. The FIs hunger for fresh funds is quite obvious in their repeated forays into the retail debt market. What is more, the divergence between the FIs sanctions and disbursals is growing. Fresh funds are being routed to service old commitments and in fact, corporates looking for funds have to make do with the comfort that they can raise bridge finance from banks on the strength of the sanction letter.

 

As the treasury head of a foreign bank notes, banks themselves are in no mood to oblige such requests for there is no telling when the concerned FI would actually make the disbursement.