RBI governor to meet public sector bankers tomorrow

The RBI, which has cut interest rates by a cumulative 1.35 percent to a decadal low of 5.15 percent in five straight moves since February, to push growth amid continued subdued inflation, is peeved at banks for not passing on the full benefit to borrowers.

Reserve Bank governor Shaktikanta Das will meet the heads of the state-run banks on Tuesday, officials said. The meeting comes a day after the bankers met finance minister Nirmala Sitharaman in the Capital. Bankers’ parleys with top policymakers come at a time when growth has slowed to a six-year low due to consumption slowdown and lack of private sector investments. Dataprints since the first quarter GDP numbers, which printed at a 5 percent, have all been disappointing with IIP contracting 1.9 percent in August–the steepest contraction in the past seven years–and not so rosy core sector and export data among others.

The RBI, which has cut interest rates by a cumulative 1.35 percent to a decadal low of 5.15 percent in five straight moves since February, to push growth amid continued subdued inflation, is peeved at banks for not passing on the full benefit to borrowers. The meeting, to be held at the Mint Road Hqs, is likely to discuss NPA resolution, potential stressed assets, restructuring of MSME loans and stress in the realty sector are among the issues which are likely to feature at the meeting, officials said.

Since Das assumed office last December, he has focused on meeting all the stakeholders, and has met bankers in many times in the past. The meeting assumes importance as it comes amid a government’s mega merger plan for few of 10 banks bringing down total number of public sector banks to 12 from 19 now.