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While admitting to visual thinking, the Chief Executive of Karur Vysya Bank K Venkataraman hailed the consistent and predictable stance of the RBI in keeping the policy rates unchanged.
The RBI is justified in stating that the current juncture is still premature for making any change in the monetary policy, but the reasons for disinflation pressures is not strong enough, noted the KVB Chief.
Asked if the bank had provided for a rate cut, he said, “No. But then, rate cut alone cannot trigger credit demand. The system interest rate should go down.”
“Rising NPAs and bad loans have been a cause of concern. Such escalated level of slippages should come down. Restructured accounts are eating away our provisions and profits. Excepting the new banks, the rest in the industry are operating on sacrificed margins.”
“That the RBI is keeping the liquidity position comfortable is a comforting factor,” Mr Venkataraman said, adding, “consistency in policy stance is important as it helps banks plan accordingly.”
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