Although there is huge surplus liquidity in the system and the Reserve Bank of India (RBI) has promised to retain its accommodative stance, bankers say interest rates will not drop any further. ”Rates are not going down from here for sure,” Ashwani Bhatia, MD, State Bank of India (SBI), said on a leading television channel. Bhatia explained that the pace of deposit growth that was seen at the start of the year had started to taper off. Moreover, the growth in advances, which was not there in the first three to four months, had come back. “We have seen corporates coming back to us and some movement in infrastructure. The retail side is robust,” the MD said. He added that fears of pain and NPAs from the retail sector have not materialised.
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