Banking shares dip post Union Budget

The BSE banking index Bankex was down 1.3% or 189 points compared to 0.28% or 54 points fall in benchmark Sensex.

Shares of most the frontline banking stocks including public and private sector are trading lower on the bourses after the Finance Minister propose to continue the interest subvention scheme for short-term crop loans.

State Bank of India, ICICI Bank, Punjab National Bank, Federal Bank, Axis Bank, Canara Bank and IDBI Bank are trading lower by 2-4% on the Bombay Stock Exchange (BSE).

The BSE banking index Bankex, the second largest loser among sectoral indices is down 1.3% or 189 points compared to 0.28% or 54 points fall in benchmark Sensex at 1332 hours.

“The interest subvention scheme for short-term crop loans will be continued and a farmer who repays the loan on time will be able to get credit at 4% per annum,” the Finance Minister P. Chidambaram said in its budget speech.

“So far, the scheme has been applied to loans extended by public sector banks, RRBs and cooperative banks. I propose to extend the scheme to crop loans borrowed from private sector scheduled commercial banks in respect of loans given within the service area of the branch concerned,” he added.