Comments on the Fourth Bi-monthly Policy 2016-17 by Ashwani Kumar, Chairman & Managing Director,Dena Bank

"For the busy season of the financial year, a cut in repo rate by 25basis point is indeed a welcome sign. With MCLR already stabilised, the pass through of this cut is expected to be quite swift. From the statement, RBI is quite optimistic about the growth trajectory and has retained its GVA projection for the year 2016-17 at 7.6 per cent. It is pertinent to note that the growth estimate of RBI for the year 2016-17 is constantly kept at the same level, thereby indicating that the risk factors to domestic growth is not substantial, probably due to the fact that growth is propelled by domestic factors than external factors. Since inflation is following the expected trajectory, the focus of RBI has now shifted to growth. One of the positives for the banking sector from the regulatory angle is the relaxation given on the treatment of sustainable debt under S4A. Though detailed guidelines are awaited, the move is a big positive for the banking sector."