Finance Minister P Chidambaram will meet heads of public sector banks tomorrow to review financial performance and credit flow to productive sectors in the light of subdued economic activity, among other issues.

Official sources today said,the broad agenda of the meeting include review of first half numbers, deteriorating asset quality and credit growth.The meeting will also dwell upon steps to increase credit flow to micro, small and medium enterprises farm sector, infrastructure and housing sector.

The officials said,Non-performing assets of the banks have been on the rise for past several months due to slowdown in economy. The Gross NPAs of some public sector banks, including State Bank of India, Punjab National Bank and Central Bank of India, have crossed 4 per cent of total assets at the end of September,2012.

The high-profile meeting is being held in the backdrop of the half-yearly review of monetary policy by the Reserve Bank of India (RBI) wherein central bank left benchmark interest rate unchanged on concern of inflation.

However, it reduced cash reserve ratio by 0.25 per cent to infuse additional liquidity of around 17,500 crore rupees into the financial system.

Meanwhile, RBI has also revised downwards the GDP growth estimate to 5.8 per cent from the earlier 6.5 per cent,while increased March-end headline inflation forecast to 7.5 per cent.