Millennium Post

SBI denies home loan rate war ... but hikes disbursal target

SBI denies home loan rate war  ... but hikes  disbursal target
Stating that it does not foresee a rate war on the home loan front, the largest lender State Bank of India on Wednesday said it is targeting an uptick in housing advances at 18 per cent on good demand and its aggressive rate posturing.

After a tepid 2014-15 on overall credit pick-up front, SBI is targeting to increase its overall loan growth to up to 15 per cent this fiscal as the economy has begun to look up, SBI Managing Director and Group Executive for national banking B Sriram told reporters on the sidelines of an event here.

“We don’t foresee any rate wars, all the lenders are competing with similar rates in similar bands. It’s good for customers, as they have a larger choice now,” Sriram said. The official, however, hinted at not reducing the auto loan spreads, as it did with home loans, saying it currently offers the most competitive rates and customers have already benefited from the 15 bps reduction in base rate last week. He further said that the bank is targeting to increase its housing loan growth to 18 per cent in current fiscal against 14.5 per cent in the recently concluded 2014-15.

As of December 2014, SBI had an outstanding housing loan book of Rs 1,52,905 crore, up from Rs 1,35,129 crore in year ago period, registering a growth of 13.15 per cent, while market leader HDFC’s loan book grew to Rs 2,19,951 crore during the same period, up from Rs 1,92,284 crore in the December 2013 quarter.

SBICard starts valuation work as GE Capital is set to exit JV

With its long-time joint venture partner GE Capital deciding to exit the financing business globally, SBI Card has started a valuation exercise for a possible new investor or a public offer. “We have started a formal valuation exercise to arrive at our current market value. The exercise may take a month from now to complete,” SBI Cards & Payment Services (SBI Card) chief executive Vijay Jasuja said. SBI, the nation’s largest lender, entered the credit card business in 1998 by roping in GE Capital India, consumer finance arm of GE Capital. GE Capital owns 40 percent stake, and the remaining stake is with SBI.
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