Associate Banks Don’t Require Additional Capital: SBI

The State Bank of India (SBI) Managing Director (MD) and VG Kannan has said that the five associate banks of SBI do not need any additional capital in this financial year as the credit growth is low. “As of now, we are comfortable in terms of capital. No plans of raising funds as of now. There is no credit growth in the market,” he said.

Kannan, who is also the group executive for SBI associates and subsidiaries, added that the that the five associates — State Bank of Mysore, State Bank of Patiala, State Bank of Travancore, State Bank of Hyderabad and State Bank of Bikaner and Jaipur — would collectively require a capital of about Rs 30,000 crore in the next five years.

He further said that bond markets and money markets have taken account of a rate cut by the Reserve Bank of India already and are moving accordingly at present. “There’s a lot of liquidity in the system and market feels that inflation has also appeared to be benign. So bond markets have factored in an interest rate cut. Deposit rates are coming down. Rates on commercial papers have come down,” he said.