State Bank of India (SBI), the country's largest public-sector lender, has confirmed that it has no plans to increase lending rates in the near future.

SBI Chairman Pratip Chaudhuri announced that the lender would not increase lending rates anytime soon, even as it had raised its bulk deposit interest rates.

The public sector lender on Thursday increased its interest rate for bulk deposits for the tenors 7-60 days to 9 per cent per annum, while interest rate on deposits of tenor 61 days to less than 1 year were fixed at 8.25 per cent per annum. The increased rates will take effect from August 31, 2013.

SBI decided not to increase lending rates as almost all top banks have already increased their base interest rates.

Axis Bank MD & CEO Shikha Sharma said that most of the lenders increased their base rates by around 25bps in response to increase in cost of funds.

Speaking on the topic, she added, "I think that will be a fair assumption to make that average cost of funds for banks have probably increased by at least that much."

The Reserve Bank of India (RBI) tightened measures to suck liquidity from the market, a move that increased cost of funds for banks.