SBI to decide lending rate revision on July 25

State Bank of India (SBI), has decided to wait till the July 25 review of monetary policy by the Reserve Bank of India (RBI) for a revision in its lending rates.

SBI and all the other government-owned banks had raised its prime lending rates with effect from May 1, 2006 by an identical 25 basis points.

SBI, which accounts for about 20% of the credit disbursed by the banking sector, witnessed a flat growth in advances during April-May 2006.
"This is a normal phenomena in the early part of a financial year. We have seen a pick up in credit in June and the momentum is likely to continue for
the rest of the year," T S Bhattacharya, acting chairman of SBI, said on the sidelines of the bank's AGM.

SBI expects credit growth in FY07 to be around 25%, which is  above RBI's forecast of 20%. SBI has seen a growth in retail deposits during April-May 2006.

Bhattacharya said the bank has approached the government seeking permission to go ahead with a share split. On the issue of raising capital through issue of fresh equity, he said a decision on this will depend on what the government has to say.