New Delhi: Finance minister P Chidambaram has asked state-owned banks to hold interest rate on home loans at the current rate and rebalance their loans to moderate credit growth to some sectors of the economy.

The FM said that all public sector banks had agreed to hold interest rate on home loans at the current rate. Home loans cost around 9-10 per cent (floating) and 11 per cent (fixed), with rates and tenure varying across banks.

Referring to recent monetary measures announced by the RBI, Chidambaram said banks have been asked to rebalance their loans to comply with the increased provisioning of capital by the bank regulator for loans on credit card, for buying shares, commercial real estate and borrowings from non-banking finance companies.

Chidambaram said that he was satisfied with the performance of banks and said bank advances had grown by 22.5 per cent during the third quarter this fiscal on year-on-year basis, and credit by 30.2 per cent.

On bank credit to the farm sector, Chidambaram said the government was confident of crossing the target of Rs175,000 crore lending to farm sector for this fiscal.

The bank credit to agriculture sector, he said, has increased by 28.4 per cent during the third quarter this fiscal and Rs149,343 crore were outstanding in the farm sector.