Follow us on

SBI up on deposit rate cut; M.Stanley unimpressed

Source : REUTERS
Last Updated: Thu, Sep 06, 2012 10:20 hrs
People walk in front of signboard displayed at head office of State Bank of India in Mumbai

Shares in State Bank of India , India's biggest lender, rose 1.8 percent after the bank slashed its deposit rates between 50-100 basis points across maturities, effective Friday.

Morgan Stanley, however, says SBI's move is more of a manifestation of a slowing economy with RBI data also showing loan growth for the system for April to August has been close to zero - similar to the 2008 levels.

Morgan Stanley further warns that reduced growth in segments facing slowdown will accelerate restructured loans creation.

But bond market dealers say SBI rate cut is a game changer and put RBI way behind the curve.

Most economists polled expect RBI to hold rates when it meets on September 17 for monetary policy.

blog comments powered by Disqus
most popular on facebook
talking point on sify news