PSU banks lost Rs 900-billion market-cap in one month post PNB scam

In past one month, the Nifty PSU Bank index tanked 20% against 1.6% decline in the Nifty 50 index.

The public sector undertaking (PSU) banks have lost Rs 900-billion market capitalisation (market-cap) in past one month after the Rs 114 billion ($1.8 billion) fraud at Punjab National Bank (PNB) came to light.

The 21 listed PSU banks have seen a combined market-cap erosion of Rs 907 billion to Rs 3,846 billion today at 02:04 pm. The total market-cap of these banks stood at Rs 4,753 billion as on February 12, 2018.

On 14 February 2018, PNB announced to the stock exchange that the bank had discovered some fraudulent and unauthorized transactions amounting to Rs 114 billion ($1.8 billion) related to group of companies led by Nirav Modi and Mehul Choksi. The PNB, on February 26, 2018 in filing to stock exchanges, said the scam has swelled by $ 204.25 million to about $ 2 billion (Rs 127 billion).

That apart, reports of cheating/fraud cases at government-run Oriental Bank of Commerce (OBC), Bank of Baroda, Andhra Bank, Union Bank of India and Corporation Bank also dented sentiment.

The Nifty PSU Bank index hit a fresh 19-month low of 2,770 on the National Stock Exchange (NSE) in intra-day trade today. The index was trading at its lowest level since August 8, 2016.

At 2:23 pm; the PSU bank index, the sole loser among sectoral indices, was down 2.3%, as compared to 1.4% rise in the Nifty 50 index.

In past one month, the index tanked 20% against 1.6% decline in the benchmark index. PNB, Bank of India, Canara Bank, Union Bank of India and Andhra Bank have seen their market price fallen more than 30% during the period.

State Bank of India (SBI) is the largest loser in absolute terms, with market-cap of state-owned bank eroded by Rs 338-billion at Rs 2,152 billion, the BSE data shows. PNB lost Rs 167 billion, followed by Bank of Baroda (Rs 91 billion), Bank of India (Rs 62 billion) and Canara Bank (Rs 59 billion).

	Price on in Rs			Market-cap in Rs crore
Bank	12/02/2018	Latest	% chg	12/02/2018	Latest	chg
SBI	288.50	249.30	-13.6	2490	2152	-338
PNB	161.65	92.85	-42.6	392	225	-167
Bank of Baroda	168.65	129.00	-23.5	389	297	-91
Bank of India	144.85	92.10	-36.4	172	109	-62
Canara Bank	327.95	228.60	-30.3	196	137	-59
Indian Bank	356.15	274.00	-23.1	171	132	-39
Union Bank (I)	127.50	87.80	-31.1	109	75	-34
Syndicate Bank	65.75	52.60	-20.0	68	54	-14
Allahabad Bank	61.00	43.85	-28.1	49	35	-14
Andhra Bank	48.75	34.00	-30.3	43	30	-13
UCO Bank	29.55	23.10	-21.8	55	43	-12
I O B	21.85	17.90	-18.1	62	51	-11
IDBI Bank	67.60	63.80	-5.6	179	169	-10
Oriental Bank	112.35	85.60	-23.8	39	30	-9
Vijaya Bank	61.25	52.85	-13.7	68	59	-9
Corporation Bank	36.25	28.85	-20.4	42	33	-8
Bank of Maha	18.95	14.25	-24.8	26	20	-6
United Bank (I)	15.25	11.79	-22.7	24	18	-5
Dena Bank	22.90	18.25	-20.3	26	21	-5
Pun. & Sind Bank	42.20	33.95	-19.5	17	14	-3
Latest price at 02:04 pm.