Interest rates softening, yet not necessarily a trend

Mumbai, Sept 26: State Bank of India Chairman&Managing Director O P Bhatt today said that the bank's July-September quarterly performance had improved and that interest rates were softening.

SBI's performance for the current quarter was better than the April-June quarter and also better than the year-ago period, he said to a query. Interacting with the Mumbai media on the sidelines of the Banking summit conducted by FICCI and IBA here, Mr Bhatt said ''Though interest rates in the country are softening currently, but it is too early to say that it is a trend.'' All the same, Mr Bhatt said,''there is enough liquidity in the system and interest rates are definitely showing a softening.'' His comments came just over a month after the country's largest bank SBI increased its prime lending rate.

Replying to a question, he said the bank has enough capital to meet the credit growth and it would do well overall growth-wise in the second quarter of this fiscal.

It may be noted that in the April-June quarter, SBI had suffered a 35 percent drop in net profit to Rs 799 crore mainly due to high taxes and staff costs.

UNI