The Hindu : Business : ICICI Bank assessing market on possibility of rate cut

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ICICI Bank assessing market on possibility of rate cut

— PHOTO: PAUL NORONHA

GUESSING GAME: K. V. Kamath (right), Managing Director and CEO, ICICI Bank, with V. M. Deosthalee, Chief Financial Officer, L&T, at the fifth CFO summit in Mumbai on Tuesday.

MUMBAI: ICICI Bank on Tuesday kept its cards close to the chest on the possibility of an interest rate cut, saying it was still assessing the demand-supply position for credit.

“Let us wait and see what happens. This is the last quarter of the year where rates normally tend to increase. It will be unwise to say how rates will move in the next six weeks. We have also to see the demand-supply gap,” Chief Executive Officer, K. V. Kamath, told reporters here on the sidelines of a CFO summit.

Property prices

Asked about the slowdown in the bank’s credit offtake during the fiscal, Mr. Kamath said there had been a slowdown in automobile and mortgage portfolios.

“There was a slowdown in segments such as automobile. There was an impact in the mortgage business also, due to high cost of property prices,” he said, adding that “There is no serious impact across the board.”

On the issue of the bank’s holding company, Mr. Kamath said it would wait for the new draft policy from the Reserve Bank of India before taking any decision in this regard.

Noting that the domestic economy is expected to continue the current growth momentum, he said he expected the economy to grow in double-digits in the next 10-25 years.

“A growth at 10 per cent is already happening. I believe that the country is able to sustain this (growth) and may even move to a double digit growth in the next 10-25 years,” Mr. Kamath said. ICICI Bank, had to cancel its plans to divest stake in a separate holding company that was to be created for its insurance and mutual funds business as the RBI did not give its approval for the same.

Mr. Kamath said the bank would wait for the central bank’s view on the issue before taking any decision on the matter.

“The RBI will come out with the new draft. Let’s see what happens,” he said.

The bank has already received sanctions from Foreign Investment Promotion Board (FIPB) and Insurance Regulatory and Development Authority (IRDA), for the proposed holding firm.

The lender has plans to transfer its equity holding in its arms — ICICI Prudential Life Insurance, ICICI Lombard General Insurance, ICICI Prudential Asset Management Company and ICICI Prudential Trust.

With a view to unlocking the value of its subsidiaries, the bank had recently announced its plans to list its subsidiaries, starting with ICICI Securities, within six months. — PTI

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