Net interest margins are unlikely to go down in the near term, according to Punjab National Bank's Chairman and Managing Director, Mr K.R. Kamath.
“To reduce NIM, banks will have to look at non-interest revenues. They will have to focus on other products to increase their revenues. This won't happen overnight and it will take time,” he said.
He added that banks would have to start increasing deposit rates to get more deposits.
Commenting on loan disbursements to the real-estate sector, Mr Kamath said, “I'm as open to lending to the real-estate sector as I was a month ago.”
He added, “As a banker I have to take into consideration the RBI's views on lending to the real-estate sector. But having said that, it does not mean that we will stop lending to the sector.”
The PNB Chairman also allayed fears on lending to micro finance institutions and said that there are no problems in lending to the MFIs.
Credit Growth
Mr Kamath was confident that the bank would meet its credit growth target for the year.
“At the beginning of the year our credit growth target was 22 per cent. But I think we will do much better than that.”
Hiring
Commenting on the bank's hiring strategy, Mr Kamath said that the bank was looking to hire people from mid-level business schools and then nurture them rather than hire from top business schools.
“Public sector banks have some restrictions in terms of how much we can pay our employees. So even if we go to top business schools and hire people from there, it is unlikely that we would be able to hold onto them for long,” said Mr Kamath.
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