Global pressure mounts on Israel as Gaza death toll surges, war deepens    Egypt targets 7.7% AI contribution to GDP by 2030: Communications Minister    Irrigation Minister highlights Egypt's water challenges, innovation efforts at DAAD centenary celebration    Egypt discusses strengthening agricultural ties, investment opportunities with Indian delegation    Al-Sisi welcomes Spain's monarch in historic first visit, with Gaza, regional peace in focus    Cairo governor briefs PM on Khan el-Khalili, Rameses Square development    El Gouna Film Festival's 8th edition to coincide with UN's 80th anniversary    Egypt's gold prices fall on Wednesday    Egypt expands medical, humanitarian support for Gaza patients    Egypt condemns Israeli offensive in Gaza City, warns of grave regional consequences    Cairo University, Roche Diagnostics inaugurate automated lab at Qasr El-Ainy    Egypt investigates disappearance of ancient bracelet from Egyptian Museum in Tahrir    Egypt launches international architecture academy with UNESCO, European partners    Egypt signs MoUs with 3 European universities to advance architecture, urban studies    Egypt's Sisi, Qatar's Emir condemn Israeli strikes, call for Gaza ceasefire    Egypt condemns terrorist attack in northwest Pakistan    Egyptian pound ends week lower against US dollar – CBE    Egypt hosts G20 meeting for 1st time outside member states    Egypt to tighten waste rules, cut rice straw fees to curb pollution    Egypt seeks Indian expertise to boost pharmaceutical industry    Egypt prepares unified stance ahead of COP30 in Brazil    Egypt harvests 315,000 cubic metres of rainwater in Sinai as part of flash flood protection measures    Al-Sisi says any party thinking Egypt will neglect water rights is 'completely mistaken'    Egyptian, Ugandan Presidents open business forum to boost trade    Egypt's Sisi, Uganda's Museveni discuss boosting ties    Egypt's Sisi warns against unilateral Nile measures, reaffirms Egypt's water security stance    Greco-Roman rock-cut tombs unearthed in Egypt's Aswan    Egypt reveals heritage e-training portal    Sisi launches new support initiative for families of war, terrorism victims    Egypt expands e-ticketing to 110 heritage sites, adds self-service kiosks at Saqqara    Palm Hills Squash Open debuts with 48 international stars, $250,000 prize pool    On Sport to broadcast Pan Arab Golf Championship for Juniors and Ladies in Egypt    Golf Festival in Cairo to mark Arab Golf Federation's 50th anniversary    Germany among EU's priciest labour markets – official data    Paris Olympic gold '24 medals hit record value    A minute of silence for Egyptian sports    Russia says it's in sync with US, China, Pakistan on Taliban    It's a bit frustrating to draw at home: Real Madrid keeper after Villarreal game    Shoukry reviews with Guterres Egypt's efforts to achieve SDGs, promote human rights    Sudan says countries must cooperate on vaccines    Johnson & Johnson: Second shot boosts antibodies and protection against COVID-19    Egypt to tax bloggers, YouTubers    Egypt's FM asserts importance of stability in Libya, holding elections as scheduled    We mustn't lose touch: Muller after Bayern win in Bundesliga    Egypt records 36 new deaths from Covid-19, highest since mid June    Egypt sells $3 bln US-dollar dominated eurobonds    Gamal Hanafy's ceramic exhibition at Gezira Arts Centre is a must go    Italian Institute Director Davide Scalmani presents activities of the Cairo Institute for ITALIANA.IT platform    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.



India central bank studies linking some new bank loans to policy rate
Published in Amwal Al Ghad on 19 - 08 - 2019

The Reserve Bank of India is looking to get banks to link some new loans to its key policy rate or other external benchmarks, Governor Shaktikanta Das said on Monday, as he pushes them to cut rates faster to stimulate a flagging economy.
Since February, the RBI has cut the repo rate INREPO=ECI by 110 basis points (bps), but most Indian banks – which rely on an opaque rate-setting mechanism, have not come close to following suit.
The State Bank of India (SBI), the largest lender by assets, has cut its benchmark lending rate by 30 bps.
Commercial banks cite high deposit rates for their inability to cut loan ones. Marginal reductions restrict how much borrowers benefit from the repo cuts.
"Today, the economy requires a certain amount of push not just from the monetary policy but also from its transmission," Das said. "I think the time has now come to formalize this linking of new loans to external benchmarks like the repo rate."
"We'd kept the external benchmarks in abeyance earlier because we wanted to see how the market evolves," the governor told a banking conference in Mumbai.
SBI, the largest lender by assets, earlier this year linked its savings bank deposits and short-term loans to the repo rate, becoming the first Indian bank to do so.
"I expect more initiatives and this process to become faster," Das said, adding that the RBI has been in talks with banks ensure "faster and greater" adjustment of rates.
Das also said the central bank was in talks with non-bank housing finance companies (NBFCs) to ensure that none collapse amid a debt crisis in the sector that has contributed to a broader economic slowdown.
The RBI is closely monitoring the 50 biggest NBFCs and housing finance companies, including their capital adequacy, stability and cash flows, Das said.
The collapse of Infrastructure Leasing & Financial Services (IL&FS) late last year created contagion fears that hit many other Indian NBFCs and dented credit growth, which has severely stung the auto and real estate sectors.
However, Das said there was no proposal at the moment for any asset quality review for NBFCs.


Clic here to read the story from its source.