HDFC Ltd said on Thursday it would cut interest rates once the cost of funds comes down.
"Cost of funds is still high, so once it comes down, we will reduce interest rates," HDFC chairman Deepak Parekh said.
Parekh's comments came two days after Finance Minister P Chidambaram said 'competition from PSU banks will force lenders in private sector to cut interest rates sooner than later'.
In response to the measures taken by the Reserve Bank to ease liquidity situation, PSU banks slashed their prime lending rates by 75 basis points, but the private sector banks are yet to make a move in this regard.