(LiveMint)
Reserve Bank of India (RBI) governor Shaktikanta Das will meet heads of public sector banks on Tuesday as the central bank looks to push greater transmission of policy rates. According to two public sector bank chiefs, Das is expected to discuss transmission of repo rate cuts into lending rates, stressed assets and credit growth by these banks. This follows Monday’s meeting of the bankers with finance minister Nirmala Sitharaman.
“While the meeting with the finance minister focused largely on credit growth and the micro, small and medium enterprise (MSME) segment, the governor will take stock of the lending rate scenario and stressed assets,” said the first banker quoted above.He said most banks have linked their retail lending rates to an external benchmark and evn lowered the marginal cost of funds-based lending rates (MCLR). The central bank has cut its key policy rate by 135 basis points since the beginning of this year in five consecutive rate cuts. While four rate cuts have been of 25 basis points each, the central bank used an unconventional 35-bps cut in August.
