SBI earlier reduced the benchmark PLR by 75 basis points to 12.25 per cent with effect from January 1.

Bhatt is in the capital to attend a meeting of state-owned bankers called by External Affairs Minister Pranab Mukherjee, who is also holding the finance portfolio.

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On the interest rate outlook, Bhatt said, "There is a downward bias" in the short run and added liquidity at this point was not a matter of concern.

"Liquidity at this point of time is comfortable ... (there is) no concern." Commenting on the possibility of increase in non-performing assets of the bank, he said NPAs may go up both in proportion and absolute terms, with some small and medium enterprises and a few large corporates contributing to such assets.

"Maybe large and medium corporates could add to NPAs ... we need to be vigilant about it ... we can deal with it," Bhatt said.