Mumbai: State Bank of India said though there is little room for further reduction in the base rate, it could cut lending rates in select categories, as it recently did for the SMEs, home and auto loans.

Given that the bank has already reduced the base rate, another round of rate cut may be difficult but the bank may go for reducing rates and thereby cutting spreads in select loan categories, SBI Chairman Pratip Chaudhuri told reporters.

The bank had slashed its base rate by 0.25 percent to 9.75 percent in a bid to transmit the benefit of the 0.25 percent reduction in the cash reserve ratio by the Reserve Bank of India (RBI).

Chaudhuri said with the reduction in base rate, the bank was leading the path of interest rate reduction in the system, in sync with the wishes of the central bank.

The bank, which had also reduced its deposit rates in some specific tenors in the recent past due to subdued credit growth, currently has an excess liquidity of over 70,000 crore, including 50,000 crore in SLR bonds.

Chaudhuri also said despite muted credit growth, the bank is hopeful of meeting its credit growth target of 18-20 percent on the back of recent reduction in the base rate.

According to Chaudhuri, credit growth is up 14.5 percent as of now, while deposits are clipping at 16 percent. The bank also aims at 20-25 percent growth in auto and home loan in the current fiscal on the back of recent rate reduction in these segments.

Referring to net interest margin (NIM), he said that NIM for domestic business till August 31 was 3.94 percent.