State Bank of India, the largest lender in the country is hoping the banking regulator to slash the CRR by 1%. Mr. Pratip Chaudhuri, the bank chairman suggests it is necessary for the profitability of the banks, and would give an impetus to the economy too.
Mr. Chaudhuri also said that the bank had even requested the RBI to increase the CRR, but the onus lies with the central bank. He further added that such a move would bring positivity in economy and stock markets.
Cash Reserve Ratio (CRR) is the minimum ratio of the total deposits of the bank, which it must keep with the RBI; currently it is pegged at 4.75%.
Earlier, the bankers from across the country had shown their interest in CRR cut more than a policy rate cut. Mr. Chaudhuri added by saying "A CRR cut is six times more effective than a policy rate cut,"