Contact Your Financial Adviser Money Making MC
4
January 2018
 |
Bank (The Total Investment
& Insurance Solutions)
The
central government has sought Parliament's nod for $12.6 billion Bank Recap
Bonds. This is a follow up of a mega recapitalisation plan that was announced
by the government in October 2017 to counter the rising bad loans
of public sector banks. The plan is worth Rs2.11 lakh cr out of which
Rs1,35,00cr will be in the form of recapitalisation bonds.
The ratification for recapitalization bonds would act significantly positive for the PSU Banks and the stocks would remain positive on this news. The capital infusion is much needed as it would aid these banks to improve their capital adequacy. As a consequence, it would also improve their loan book growth for the coming years, besides giving room to provide for bad loans.
Nifty PSU Bank Index has climbed over 1.5% after recap bond news. At the time of filing, IDBI Bank was up 6%, BoB, PNB were up by 3% each, Bank of India, Canara Bank were up 2% each, and SBI was up 1.5%The Total Investment & Insurance Solutions
The ratification for recapitalization bonds would act significantly positive for the PSU Banks and the stocks would remain positive on this news. The capital infusion is much needed as it would aid these banks to improve their capital adequacy. As a consequence, it would also improve their loan book growth for the coming years, besides giving room to provide for bad loans.
Nifty PSU Bank Index has climbed over 1.5% after recap bond news. At the time of filing, IDBI Bank was up 6%, BoB, PNB were up by 3% each, Bank of India, Canara Bank were up 2% each, and SBI was up 1.5%The Total Investment & Insurance Solutions
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