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October 22, 2001
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'SBI to review rates soon'

The chairman of government-run State Bank of India, the country's largest commercial bank, said on Monday it will review its lending and deposit rates soon, after the central bank cut its key bank rate.

"We will definitely review the lending and deposit rates in the next few days. Our asset liability committee will meet to decide," Janki Ballabh told Reuters.

The Reserve Bank of India on Monday cut its bank rate to 6.5 per cent from seven per cent and slashed cash reserve ratio requirements for banks to 5.5 per cent in two stages, from 7.5 per cent, to kickstart a sluggish economy.

Commercial banks use RBI's bank rate to price their loans.

Ballabh also said the policy will boost market sentiment.

"The credit policy will give a boost to sentiment and is very market friendly," he said.

SBI shares were up 3.03 per cent at Rs 190.65, outpacing the 0.67 per cent rise in the benchmark Bombay share index, in afternoon trade after the policy announcement.

The Monetary & Credit Policy

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