Home loan rate cuts didn't dent the margins: Bankers and analysts

Experts don't see further cuts boosting demand, with rates already at record lows

The margins of banks have been unaffected by cuts in home loan rates and a further reduction is unlikely to translate into a significant increase in demand, according to bankers and analysts.

Keki Mistry, vice-chairman and chief executive, HDFC, said the new funding was happening at lower rates than earlier. This has reduced the weighted average cost of funds and hence lender(s) passed on the benefits to customers. This has not impacted margins.

Seconding Mistry, Prashant Kumar, managing director and chief executive, YES Bank, said just as loan rates had gone down, the cost of deposits had lowered. This balances out, indicating