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Non-Tech : ICICI Ltd - (Nyse: IC) -- Ignore unavailable to you. Want to Upgrade?

To: Mohan Marette who wrote (293)	3/1/2000 10:29:00 PM
From: Mohan Marette	Read Replies (1) \| Respond to of 494

ICICI likely to breast the tape, slash interest rate Mar 02, 2000 Sitanshu Swain MUMBAI, MARCH 1: Term lending institution, ICICI Ltd, is likely to be the first to go off the block to slash interest rates even as commercial banks are not willing to consider any rate cut. If ICICI actually cuts its lending(and borrowing) rates, it will be the second round of rate cut in the last quarter of the current fiscal for the institution. Speaking to The Financial Express, ICICI's senior general manager Kalpana Morporia said the budgetary announcement effecting a one percentage pointreduction in the rate of general provident fund (GPF) with effect from April1 is further softening the interest rates and the institution may take thisopportunity to lower its lending rate by 50 basis points. The RBI is expected to announce one percentage point cut in bank rate cutany time now, senior bankers said. The government started sending strong signals for a lower interest regime from the beginning of the last quarter with cuts in the rate on public provident fund (PPF) by one percentage pointto 11 per cent on January 15. ICICI was the only financial intermediary to respond to the PPF rate cut by cutting its lending rates. ICICI reduced its long term lending rate by one percentage point and short and medium termprime lending rate by 50 basis points, thereby pegging its lending rates ata uniform 12.5 per cent for across all segments. None of the banks and institutions cut their lending rates at that time even though some of them reduced their deposit rates. Banks and institutions chose to wait for a stronger signal from the RBI. "It is matter of time that a bank rate cut will be announced by the central bank as the budget has sentstrong signal on low interest scenario, Morparia said. "Last time, we werethe first to bring the lending rate down. We will watch the market movment for couple of days before taking a decision to this effect," she said. ICICI is planning to enter market with its last borrowing programme during March. It is trying to readjust the borrowing rates in its ongoing privateplacement programmes keeping the lower interest scenario in view. The Industrial Development Bank of India has cut the coupon on its five yearbond issue by 150 basis points. IDBI chairman GP Gupta said the institution will exercise the greenshoe option and mop up Rs 600 crore. Gupta admitted that the interest rates are softening. He however refused to commit on anypossible rate cut. According to Morparia, the budget has a positive impact on ICICI'sperformance including the nascent personal finance operation including thehousing loan. "I expect a roboust growth in our treasury operation due to the higher return on trading of securities,' she said. -Indian Express Newspapers (Bombay) Ltd.