The collateral damage on sentiment saw the Nifty PSU Bank index tank to an over 10-year low, falling 8 per cent in intra-day today. Nifty Bank index tumbled 5.7 per cent, followed by Nifty Private Bank index (5.6 per cent), and Nifty Financial Services (down 4.6 per cent), as compared to 3.9 per cent decline in the benchmark Nifty 50 index.
Among individual stocks, RBL Bank, IndusInd Bank, AU Small Finance Bank, United Bank of India, Corporation Bank, Allahabad Bank, Max Financial Services, Edelweiss Financial Services, Indiabulls Housing Finance, Shriram Transport Finance and PNB Housing Finance were down between 12 per cent and 20 per cent on the NSE.
The Ministry of Finance took the decision after considering an application submitted by the RBI, a ministry statement said on Thursday evening. The moratorium will last till April 3 and all legal proceedings against the bank will be stayed during the period, it said. The bank is not allowed to pay any depositor more than Rs 50,000 without written permission from the RBI during the period of moratorium.
Meanwhile, the board of directors of the State Bank of India (SBI) has given an in-principle approval to explore investment opportunity in Yes Bank Ltd., according to a statement filed with stock exchanges.
At 09:38 am, shares of SBI were trading 7 per cent lower at Rs 269, after falling 12 per cent intra-day to Rs 254 on the NSE. YES Bank was locked in lower circuit of 25 per cent at Rs 27.60 on the NSE. A combined 4.96 million shares have changed hands already and there were pending sell orders for 132 million shares on the NSE and BSE, exchange data shows.
As of now, SBI's interest is likely to be in the form of investment only, implying limited financial impact on SBI, thereby excusing merger possibility in the near term, but one has to keep a track if no new investor is found, SBI may eventually have to bite the bullet, the brokerage firm said with retain SBI target price of Rs 400 but would monitor further developments and review our target price as clarity emerges, for us YES is not rated, it said.
|UNITED BANK (I)||6.14||7.48||-17.9|
|NIPPON LIFE IND.||349.30||385.10||-9.3|
|SREI INFRA. FIN.||6.52||7.18||-9.2|
|AU SMALL FINANCE||1070.60||1176.30||-9.0|