Banks shares edge higher on RBI action on defaulters

MUMBAI (Reuters) - Indian bank shares edged higher on Wednesday after the central bank said it had identified 12 of the largest loan defaulters and will order lenders to start bankruptcy proceedings against them, without disclosing any account names.

Top lender State Bank of India was trading up 0.2 percent by 0356 GMT, having risen as much as 0.7 percent, while Punjab National Bank was 0.4 percent up.

While taking defaulters to bankruptcy proceedings will speed up resolution of bad loans, it may also require the capital-starved state-run banking sector to make higher provisioning, analysts said.

($1 = 64.3300 Indian rupees)

 

(Reporting by Devidutta Tripathy; Editing by Rafael Nam)