PSU bank stocks extend Tuesday's fall

Ten PSU bank stocks fell by 0.09% to 2.81% at 13:32 IST, extending Tuesday's fall triggered by two international ratings agencies downgrading ratings of some banks on Monday, 23 September 2013.

Meanwhile, the BSE Sensex was down 217.96 points, or 1.09%, to 19,702.25

Oriental Bank of Commerce (down 2.52%), Corporation Bank (down 1.78%), Vijaya Bank (down 1.32%), Indian Bank (down 0.64%), Union Bank of India (down 1.4%), Andhra Bank (down 1.5%), Bank of India (down 2.38%), Bank of Baroda (down 0.09%), Canara Bank (down 2.81%) and Punjab National Bank (down 0.9%) declined. State Bank of India (SBI) rose 0.48%.

Indian Bank (down 4.01%), Punjab National Bank (down 0.04%), SBI (down 0.33%), Bank of Baroda (down 1.3%) had declined on Tuesday, 24 September 2013.

Ratings agency Moody's on Monday, 23 September 2013 downgraded its outlook on State Bank of India (SBI)'s financial strength rating to 'negative' from 'stable'. Moody's also downgraded SBI's unsecured debt rating on par with the sovereign foreign currency bond rating. SBI's standalone credit profile continues to face negative pressures, and it will have to compete with other public sector lenders for capital injection from the government, Moody's said. SBI's impaired loan ratio of 8.6% at end-June is below the 11.5% average for Indian public sector banks rated by Moody's.

Meanwhile, ratings agency Fitch on Monday, 23 September 2013 downgraded some ratings for Indian Bank, Punjab National Bank and Bank of Baroda on expectations of a further deterioration in asset quality and a sharp deceleration on economic growth.

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