Dinesh Kumar Khara, Chairman, State Bank of India (SBI), on Wednesday, said that inflation cannot be unseen but growth continues to be the main focus as of now.

"Growth continues to the focus and having said that, inflation cannot be lost sight of. So, I think we will be very closely watching the situation; we are really looking at it as best, as we can take care of the interest of all the stakeholders," he said.

He expects loan growth to be in double-digits.

"We expect the year which has gone by- we should have loan growth in at least two digits, which should be 10 percent plus for FY22," he added.

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India's consumer price index (CPI) has breached Reserve Bank of India's (RBI) comfort zone of 6 percent for the third straight month indicating a strong rate hike. It was at 4.29 percent in the year-ago period.

Khara said that the bank has started raising term interest rate. He highlighted that not only is repo rate a benchmark for the bank, MCLR is also used as a benchmark for some of the advances.

"Last quarter itself, we have started increasing our term deposit interest rates. Repo is not the only benchmark, we have got couple of other benchmarks also. Our own MCLR is also something which we use as a benchmark for some of the advances," he said.

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He explained that he is seeing better capacity utilisation now. Infra related projects have started coming in and he is seeing capex in airport and port segment, he mentioned.

"As of now, we are seeing some kind of a better capacity utilization in terms of working capital utilization having improved, also the term loan availment has improved. The infrastructure related projects which are coming in, there also we are seeing capex. Even in the airport sector, we are seeing capex coming up," he explained.

On home loans, he said that underwriting the same will depend on the liquidity in the balance sheet.

"Underwriting of new home loans will be a function of liquidity. Liquidity is still in a surplus mode. So I think, we'll have to wait and watch the overall competitive stance as far as interest rates are concerned and accordingly, we'll be taking a call as far as the new home loan rates are concerned, but as of now, I don't see any major challenge on that," he said.

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First Published:Apr 13, 2022 1:04 PM IST