On paper it appears a good tactic. More of a low-lying fruit, as of now !
May be there was 'advice' from ministry to drop rates
Indeed, lower interest rates by itself may not be sufficient. But, private banks always back up a drop in rates with increased focus on sales, promos, leverage on dealer/developer relationships, cross-sell, etc.
It depends how much SBI is able to do same within their system. SBI's clientele is the key - majority of them, unlike private banks' clients, will not be so much in doubt of their job-security. If SBI is able to get the sales focus at the front-end (counter) and branch-level, there is enough business out there to ensure growth in volumes
http://blogs.wsj.com/indiarealtime/2012/08/03/it-takes-more-than-this-to-boost-home-and-car-sales/
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