“We expect rate hikes to end and we might see a reversal,” Gautam Vir, MD&CEO, Development Credit Bank

The past consecutive rate hike moves undertaken by the RBI (of course, at the behest of the FM) are the major fallout of the RBI’s decision to restrict liquidity in the system in order to control inflation in the economy. But consequently, and sadly, higher interest rates are now not only draining the finances of the borrowers, but also ensuring that they are in a perplexing fix over the issue of whether to opt for fixed or floating rates. Be it individual borrowings, corporate loans or credit card overdrafts, banks have not spared any form of a loan. While the State Bank of India has raised its PLR by 50 basis points, Bank of Baroda has followed with a rise of 75 basis points, and ICICI Bank has topped them all with a rise of 100 basis points. It simply means that the lending rates for prime individual borrowers have now touched the 12.75% mark and around; and if you thought that that was high, save your sighs when you hear that now, the corporate PLR has smashed up to 15.75%.

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Source : IIPM Editorial, 2007

An IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative

Rashmi Bansal Publisher Of JAMMAG Magazine Caught Red-Handed, for details click on the following links:-

• Hindustan Times Article - Publisher goes underground
• Rashmi Bansal (Editor of JAMMAG)
• Rashmi Bansal (Publisher of JAMMAG)