No rise in NPAs: ICICI

Mumbai, Aug. 12: ICICI Bank’s non-performing assets may not rise on higher lending rates, the bank’s joint managing director and chief financial officer, Ms Chanda Kochhar, said on Tuesday. The bank hiked its benchmark prime lending rate by 75 basis points from July 31.

Higher interest rates may, however, impact future rate of growth in business, Ms Kochhar said on the sidelines of a banking technology seminar.

"The retail sector is expected to grow at five to 10 per cent, but corporate growth will remain strong and will support a credit growth of 15-16 per cent," Ms Kochhar said.

The monetary tightening by the Reserve Bank of India in the current financial year was aimed to bring down credit growth, and contain demand side pressure on inflation. "There is a huge investment pipeline. We are settling at 7.5-8 per cent GDP growth. I think it (GDP) is sustainable," she said.

"We have to recognise there are opportunities on one hand and certain challenges on other hand. These monetary tools are used as interim measure to attain the objective of bringing down inflation by March-end," Ms Kochhar said. — NW18

RBI wants to bring down inflation to 7 per cent by end-March. For the week to July 26, the headline inflation was 12.01 per cent .

On being asked about possibility of softening of interest rates, Ms Kochhar said: "It is too early to talk about softening of interest rates."

ICICI Bank shares closed at Rs 740.65 on the National Stock Exchange, down 3.96 per cent from Monday.

Meanwhile, ABN Amro Bank India’s country executive Meera Sanyal expects GDP growth to be hit in medium-term, though long-term investment pipeline remains intact.

Ms Sanyal said ABN Amro Bank is witnessing a slight increase in its bad loans in credit card and personal loan portfolios due to higher interest rates. (NW 18)End