After being assured by the public sector banks on their interest rate reduction, the finance ministry is all set to persuade the private sector lender on money supply situation and lending rates.

Finance Secretary Arun Ramanathan and other senior officials from the finance ministry are likely to meet senior representatives of ICICI Bank, HDFC Bank, Axis Bank, HSBC, Citigroup, Duetsche Bank and others on November 5th.

Finance minister P. Chidambaram had met the chiefs of PSU banks on Tuesday where the government disclosed measures to help banks reduce their bad loans and keep them lending to small and medium enterprises (SMEs).

Chidambaram said, “Public sector banks have assured me they will deliver credit at an appropriate price, having regard to creditworthiness of borrower and risks involved.”

Mr. Ramanathan has called for a meeting with the private and foreign banks in order to discuss the similar issue. Although no official plan has been circulated as the meeting has been called at a short notice, discussion is expected to hold on slashing interest rates and enhancing credit availability.

The chiefs of apex group had met Mr. Chidambaram after meeting the Prime Minister on Monday. Prime Minister Manmohan Singh has formed an apex group to coordinate between the government’s response and points raised by industry from time to time.