Demand for Housing Loans Doubles After Interest Rate Cut: SBI Says

India's biggest lender SBI (State Bank of India) on recently said it is witnessing early signs of revival in credit growth as mid-size companies have started seeking fresh funds.

Mr. A. Krishna Kumar, MD & Group Executive for National Banking, SBI said,  “There are early signs of credit uptake. Mid-size companies are coming for fresh lending. It is too early to predict a full-fledged credit revival based on these early figures.The number of applications have nearly doubled in the home loan segment after the recent reduction in interest rates in these segment".

Mr. Kumar, however, added that there is less space for further reduction in interest rates in these segments as the spreads are already lowered in the retail segments.We have already reduced our interest rates on home loan, which is just above our base rate. So, there is less space for further reduction in interest rates in these segments. As of now, we are not revising credit growth target. We expect 18 to 20% growth this financial year (2012-13) in retail segment”

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