SBI estimates 19-20% biz growth this financial year

Country’s largest lender State Bank of India (SBI) is targeting 20 per cent year-on-year growth in its business – credit and deposits – during the current financial year (2012-13) on expectation of better business and economic environment. The pace of credit expansion at SBI moderated in year ended March 2012, to 16 per cent from 20.3 per cent in 2010-11. Reflecting the economic slowdown, the bank's credit grew by 17 per cent in 2011-12 down from 21.5 per cent in 2010-11, according to Reserve Bank of India data. BSE | NSE Price SBI Click here for Cloud Computing Also Read Related Stories News Now - Slow economic growth may hurt banks' asset quality, says Pranab - Currency advantage for companies - Keep an eye on 17,300 level - SBI to look at rate cuts after RBI's credit policy - RBI tells mkts to price state bonds on financial health - Morbi also emerging as non-woven plastic making destination SBI’s deposit growth also decelerated to 14 per cent from over 16 per cent. “The growth deposit was lower in FY12 as large amount of money flowed into tax free bonds,” SBI chairman Pratip Chaudhuri told reporters at the international banking and finance Indian Merchants’ Chamber (IMC) here. Referring to room for reducing interest rates, the SBI chief said bank will reduce lending rate if the Reserve Bank reduces cash reserve ratio in the credit policy later this month. “We expect a CRR (cash reserve ratio) cut of 75 basis points. If it happens, we will definitely pass the benefit to the consumers," he said. RBI will unveil its annual monetary policy on April 17. CRR is the portion of deposit that banks are required to keep in cash with the RBI. At present it is 4.75 per cent. Chaudhuri, however, said the bank may not cut the base rate, the minimum lending rate. "Base rate is linked to the cost. That is average cost of deposit plus cost of intermediation. So, change in base rate is a little difficult. However, we will reduce the margin in some of the segments," he said. The bank will close the financial year with the net interest margin (NIM) of 3.85 per cent, he said.