Nifty PSU Bank index slips over 6%; SBI, Union Bank, IDBI down over 7%

Since January 1, Nifty PSU Bank index plunged 20%, while Nifty Bank slipped 11% against 6.3% fall in Nifty 50 index.

Shares of banking shares remained under selling pressure with most of the frontline stocks down between 5%-9% on the National Stock Exchange (NSE) in late trades.

State Bank of India (SBI), Allahabad Bank, Union Bank of India, Syndicate Bank and IDBI Bank were down more than 7% each.

ICICI Bank, Andhra Bank, Oriental Bank of Commerce, Canara Bank, Punjab National Bank, Indian Overseas Bank, Bank of India and Bank of Baroda down 4%-7% on the NSE. Most of these banks are currently trading at multi-months low on the bourses.

At 02:53 p.m. Nifty PSU Bank index was down 6.4% as compared to 1% decline in the Nifty 50 index. The Nifty Bank, a gauge of private and public sector bank index, was down 2.5%.

According to broking firm K R Choksey Shares and Securities, the October-December (Q3FY16) should mark as one of the toughest quarters particularly for PSU banks in the light of continued surmounting asset quality pressures.

“With Regulator insisting on expedition of balance sheet clean-up sooner than later, steep base rate cuts, flat G-sec yields and moderate economic recovery should keep the banks on their toes,” the broking firm said in a Q3 results preview.

Since January 1, 2016, Nifty PSU Bank index plunged 20%, while Nifty Bank index slipped 10.6% as compared to 6.3% fall recorded by the benchmark index.