Shares of 14 banks fell by 0.16% to 3.22% at 11:15 IST on BSE after the Reserve Bank of India raised key interest rates by 25 basis points at the third quarter review of monetary policy for 2013-14 today, 28 January 2014.
IndusInd Bank (down 3.22%), Bank of India (down 2.19%), Punjab National Bank (down 1.88%), ICICI Bank (down 1.72%), Yes Bank (down 1.34%), Canara Bank (down 1.31%), Axis Bank (down 1.29%), Kotak Mahindra Bank (down 0.88%), Union Bank of India (down 0.72%), HDFC Bank (down 0.67%), Federal Bank (down 0.56%), Bank of Baroda (down 0.45%), IDBI Bank (down 0.26%) and State Bank of India (down 0.16%), edged lower.
The S&P BSE Bankex was down 1.58% at 11,866.06. It underperformed the S&P BSE Sensex, which was down 0.67% at 20,568.44.
The S&P BSE Bankex had underperformed the market over the past one month till 27 January 2014, falling 7.78% compared with the Sensex's 2.29% fall. The index had underperformed the market in past one quarter, faliing 3.12% as against Sensex's 0.12% rise.
The Reserve Bank of India (RBI) increased the policy repo rate under the liquidity adjustment facility (LAF) by 25 basis points from 7.75% to 8%.
RBI kept the cash reserve ratio (CRR) of scheduled banks unchanged at 4% of net demand and time liability (NDTL).
Consequently, the reverse repo rate under the LAF stands adjusted at 7%, and the marginal standing facility (MSF) rate and the bank Rate at 9%.
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