State Bank of India sees loan growth picking up from FY16

State Bank of India, the country's largest lender, expects loan growth to rise to as much as 15 per cent in the 2015-16 financial year, boosted by government auctions for coal blocks and telecom spectrum, Chairman Arundhati Bhattacharya said on Tuesday.

That compares to what is expected to be "very very low" loan growth of below 10 per cent in the current financial year ending March 31, 2015, Bhattacharya said in an interview.

She also said a cut in the country's cash reserve ratio (CRR), the share of deposits which banks must hold with the Reserve Bank of India (RBI), would "definitely help" lenders to cut loan rates, Bhattacharya said.

Most banks have yet to cut their base lending rate, despite a 50 basis point reduction in the repo rate by the RBI so far in 2015.

(Reuters)