![](http://im.rediff.com/money/2011/jun/10sbii3.jpg)
"Our bank, it's for ALCO to take a view. But we would prefer a more secular rate cut with the adjustment in the base rate because we have almost (done) rebalancing of the portfolio... but it is for ALCO to take a final view," SBI Chairman Pratip Chaudhuri said at the press meet after RBI unveiled half-yearly review of credit policy.
"I think our ALCO (asset liability committee) would meet in a day or two," he said. At present, the base rate of SBI stands at 9.75 per cent. The bank last reduced its base rate downward on September 20 by 0.25 per cent.
The CRR, or the portion of deposits banks have to park with the RBI, now stands at 4.25 per cent, while the repo rate at which RBI lends to the system, has been left unchanged at 8 per cent at the second quarter review of the monetary policy.
Highlighting the impact of interest rate cut on the retail loan demand, Chaudhuri said, daily home loan sanction has tripled following the rate cut by the bank in August.
"We have greatly benefited by rate cutting because now the growth is coming in the retail segment which is rate sensitive and ever since we have dropped our home loan rate our daily sanctions have almost tripled. Home loan sanctions used to be Rs 65 crore, now there are about Rs 150 crore per day," he said.
The bank had reduced lending rates on car and home loans by up to 0.6 per cent in August. Earlier this month, SBI reduced the processing fee on home and auto loans by 50 per cent to cash in on festive season demand.
For home loans up to Rs 25 lakh, the processing charge is 0.125 per cent of the loan amount from 0.25 per cent.
In case of loans between Rs 25 lakh and Rs 75 lakh, the processing fee is Rs 3,250 as against Rs 6,500, while loans above Rs 75 lakh, it is flat Rs 5,000 as compared to Rs 10,000 per application earlier.
With regard to auto loan, the processing charge has been slashed to 0.255 per cent of the loan amount as against 0.51 per cent.