At 02:57 pm, Nifty PSU Bank index, the top loser among sectoral indices, was down 2.7 per cent, as compared to a 0.4 per cent decline in the benchmark Nifty 50 index, Nifty Bank and Nifty Private Bank index.
In the past two trading days, Nifty PSU Bank index slipped nearly 5 per cent, against 1 per cent decline in the Nifty 50 index. In the past two months, it has tanked 16 per cent, as compared to less than 1 per cent fall in the benchmark index.
The Supreme Court (SC) has come out heavily on the Department of Telecommunications (DoT) for not recovering adjusted gross revenue (AGR) liability from the telecom companies and asked the operators to pay the dues before the next hearing on March 17, 2020. Total AGR liability stands at Rs 1.47 trillion of which Bharti Airtel/Vodafone Idea need to pay Rs 34,000 crore/Rs 44,000 crore.
According to Motilal Oswal Securities view, this will have an impact on the banks’ asset quality as Vodafone Idea faces an imminent risk of shutdown.
Meanwhile, six of the 18 PSBs were in losses in the December quarter. In the previous quarter, five had been in the red. The two new entrants in the “loss club” are PNB and BoB, while Union Bank of India, which had made a loss of Rs 1,194 crore in September, bounced back into the black. Overall, PSBs made a net loss of Rs 2,712 crore against Rs 727 crore in September and Rs 7,384 crore a year ago.
According to a Business Standard
report, India’s state-owned banking industry is not out of the woods as yet. Fresh slippages are staring at many of them. Also, unless they start lending, it will be difficult to pare their non-performing assets (NPAs) as this is computed as a percentage of their loan book. CLICK HERE TO READ FULL REPORT