The Reserve Bank of India’s decision to reduce the cash reserve ratio and repo rate by 25 basis points each is on the expected lines, according to Karnataka Bank.
P. Jayarama Bhat, Managing Director and Chief Executive Officer of Karnataka Bank Ltd , told Business Line on Tuesday that RBI has once again taken a cautious view.
Terming it as a moderate policy, he said: “We may see one more rate cut in March.”
To a query on whether the bank will cut interest rates immediately, Bhat said: “I don’t react on that immediately. It all depends on how the market moves. Depending on that we may take a decision.
“Any further actions will depend on our discussions in ALCO (asset-liability committee) of the bank. Based on the market sentiments and overall actions in the banking scenario, we may take a view in the ALCO.”
Bhat said that Karnataka Bank had reduced its base rate by 25 basis points in October though there was no rate cut then in the quarterly monetary policy review. Then the bank had also reduced the deposit interest rate.