Corporate borrowing shifts to banks as SBI MCLR spread over bonds narrows

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Corporates are likely to increase bank borrowing as the gap between SBI's lending rates and bond yields shrinks. This spread, which had widened significantly, has now decreased, making bank loans more attractive. SBI anticipates double-digit growth in corporate loan demand as companies find bank financing more cost-effective than the bond market, especially with anticipated MCLR adjustments.