Banks have appealed to the Reserve Bank of India (RBI) for easing norms for deals relating to lending in the infrastructure sector. The appeal is to help banks deal with the asset-liability mismatch.

The top bankers asked for a cut in savings bank rate during a pre-policy meeting with RBI Deputy Governor Subir Gokarn. The bankers expect to improve net interest margins with the cut in savings rate.

The asset-liability gap is rising as most new deposits have a shorter maturity term of around one year while the tenure for loans to infrastructure projects is of 15-20 years.

The banks had earlier requested the finance ministry to allow the issue of tax-free bonds. They have asked the RBI for an exemption for such bonds from cash reserve ratio and statutory liquidity requirements.

According to a government estimate an investment of $550 billion is required in the infrastructure sector in the five-year Plan 2007-2012. This outlines the importance of bank finance in the sector.

The government has started work on take-out financing to deal with the asset-liability gap experienced by the banks. Under the guidelines worked out by the India Infrastructure Finance Company Ltd (IIFCL) for take-out financing, an arrangement would be in place where banks would initially finance long-term projects while another funding body will buy these loans at later date.

Bankers see enough liquidity and expect stable interest rates till the end of the current fiscal while they expect the RBI to raise CRR during its policy review this month end.

Banks urged the central bank for a cut in the interest rate that they have to pay on deposits in savings bank accounts. Banks request the rate be lowered to 3 per cent from 3.5 per cent at present.

RBI has said earlier that the interest rate on savings would be calculated on a daily basis from April 2010 and according to the banks this would result in a rise in cost of around 75 basis points for them. Banks also expect the government to help on funding expenses incurred for financial inclusion. They asked the government to take care of the cost incurred to create infrastructure for financial inclusion as building capacity for expanding their reach was proving to be a burden to some banks.