Liquidity expected to keep rates stable in near term

ICICI Bank expects interest rates to remain stable in the near term due to sufficient liquidity. "Liquidity is not a concern," executive director Chanda Kochhar said at the launch of a co-branded credit card by ICICI Bank and Toyota Kirloskar Motor.

Factors such as cash reserve ratio and inflation would have an effect on the rates, she said, adding, "It is not liquidity but the demand from depositors which we are trying to address."

Speaking on the bank's plans to expand in the rural segment, Kochhar said it is focusing on increasing exposure to the agriculture sector.

"We are working on a pilot project on the agricultural sector now. Our rural strategy is likely to be rolled out in the next one to two years," Kochhar said.

"The rural sector is the next growth horizon for us," she said. The bank would use both its branch network and electronic channels to tap the sector. It had recently hiked the lending rates on housing and automobile loans by 0.5-1 per cent.

The co-branded card will offer the customers one free service at Toyota dealership, five per cent discount on standard Toyota accessories and four reward points for every Rs 100 spent on credit card at the Toyota dealer.