Punjab National Bank, the second-largest public sector lender, is likely to hike its deposit rates by 25 to 50 basis points in view of the increase in repo and reverse repo rates announced by the RBI in its first quarter review of the monetary policy this week.
“The deposit rates may increase by 25 and 50 basis points across different time baskets and we will take a call on it in our next Alco (Asset Liability Committee) meeting, which will take place in a day or two,” PNB Executive Director Nagesh Pydah told reporters here today, on the sidelines of a bankers' committee meeting.
He further said that the decision will initially be taken on deposit rates only. “If the deposit rates are raised, definitely there will be an impact on lending rates also. But there will be a lag in raising lending rates,” he said.
“There was a move to revise the lending and deposit rates in the last Alco meeting, but we deferred it and waited for the outcome of RBI’s monetary policy,” he said.
RBI, in its first quarter review of the monetary policy, raised the repo and reverse repo rates by 25 and 50 basis points respectively to contain the rising inflation.
PNB is eyeing a deposit growth of 20 per cent and advances growth of 24 per cent in the current fiscal. “We have kept out growth level of deposit and lending two to three per cent higher than the RBI’s guidance for this year,” he said.
PNB had, last year, achieved deposit and lending growth of 22 and 26 per cent respectively.
