'Investors need to expect steady returns over the next one to two years with bouts of high volatility.'
Moderate credit growth at around 22 per cent and relatively higher deposit growth has placed the liquidity situation of banks in more comfortable zone.
Superseding the boards of two non-banking financial companies (NBFCs) in the Srei group will neither create liquidity challenges for sound entities, nor build systemic crises because the markets have factored in the problems with the Kolkata-based firms. Such regulatory steps will help in making the NBFC space more robust, bankers and market experts said. The action should have begun earlier because the Reserve Bank of India (RBI) had done a special audit last financial year and asked the group to make provisions for assets considered stressed, analysts said.
Risk aversion leading to 'lazy banking'; lenders prefer govt securities
This is a good opportunity for long-term investors to pick quality small and midcap stocks at reasonable valuations.
Analysts had on average forecast a net profit of 23.21 billion rupees, according to Thomson Reuters data.
HDFC Bank was the top gainer in the Sensex pack, rallying over 4 per cent, followed by SBI. IndusInd Bank, ICICI Bank, Axis Bank and HDFC were also among the gainers. NSE Nifty soared 269.25 points to 15,175.30.
Vrde currently manages about $14 billion globally, and has invested nearly $500 million in India in the past five years
Rating agency Fitch on upgraded outlook of 10 financial institutionals, including SBI, ICICI Bank and EXIM Bank of India to 'stable' from 'negative' earlier following revision in the country's outlook.
The 30-share Sensex ended 50 points lower at 21,143 and the 50-unit Nifty was down 23 points at 6,291.
Education finance is a complex and dynamic sector. There are too many variables -- the course, the calibre of students, the universities, and the job prospects once the course is over, notes Tamal Bandyopadhyay.
ICICI Bank, HDFC Bank and Axis Bank reported healthy loan growth and asset quality.
For the startup ecosystem in India, the scorecard so far has been a mixed bag, observes Akhil Gupta.
State-run lenders will take a lead in creation of the bad bank, but the sick asset resolution platform needs the support of private banks and other lenders to be successful, State Bank of India managing director Swaminathan J said on Thursday. If all lenders come on board, the National Asset Reconstruction Company (NARC) announced in the budget will be able to aggregate 100 per cent of a sick company's outstanding loans, which shall ultimately lead to better resolution of the asset quality stress for all. The government is yet to announce the specific contours of the NARC or the bad bank and has also only said that it is willing to provide some sovereign guarantee to help the platform.
Moody's rates a total of 15 public sector and private sector banks, which together accounted for about 66 per cent of the banking system's estimated total assets on March 2012.
Even as concerns over PSU Banks' asset quality and growth rates remain, there are few that offer a favourable risk-reward equation.
French energy giant TotalEnergies SE's $300 million investment in clean energy projects of Adani Green Energy Ltd has taken the total investments poured in by global investors in India's largest renewable power producer to $1.63 billion or about Rs 14,000 crore, sources close to the company said. Last week, Total announced it will hold a 50 per cent stake in the new joint venture firm where Adani Green Energy Ltd (AGEL) will hold the rest. The joint venture will hold a portfolio of 1,050 MW, including 300 MW of already operational capacity, 500 MW under construction and 250 MW under-development assets with a blend of solar and wind power.
Besides financials, shares of telecom, IT, auto and pharma were in demand.
Banks are in need of government support to manage the stressed assets
It appears the two banks are now convinced that increasing their credit card portfolios will not lead to significant erosion in asset quality.
As the fight for deposits intensifies, the cost of money will rise and the margin will be under further pressure, points out Tamal Bandyopadhyay.
Mark-to-market risks to the Indian banking sector are limited and manageable, says RBI
Conceding that there has been risk aversion among the lenders stemming from their rising asset quality concerns, the Governor said banks should lend to productive sectors, notwithstanding the importance of asset quality, by being discerning.
Global ratings agency Moody's on said it has a "negative" outlook on the country's banking system due to concerns over asset quality and the high interest rates.
HDFC Bank's 12-month forward price-to-book ratio is estimated to be the highest among 166 large and mid cap banks in Asia Pacific.
The report said resilience of the banks has increased with a sharp improvement in the provision coverage ratio to 60.6 per cent in March 2019 from 52.4 per cent in September 2018 and 48.3 per cent in March 2018.
While the stress is lower than projections, it would be higher than what we saw last year because of the pandemic: Axis.
Bankers are confident that unlike the last time, there would not be significant erosion in asset quality, since their expansion strategies are backed by rich information on borrowers' credit histories.
India's banking system is expected to remain unscathed from the troubles in Credit Suisse as it has a very small presence in the country, experts said. Although Credit Suisse is more relevant to India's financial system than Silicon Valley Bank (SVB), it has very limited operations, according to a report by Jefferies India. The Switzerland-based bank, the report said, "has less than Rs 20,000 crore in assets (12th among foreign banks), presence in the derivatives market and funded 60 per cent of assets from borrowings, of which 96 per cent are up to two months.
International credit ratings agency Moody's Investors Service changed its outlook for India's banking system to negative from stable due to concerns that an increasingly challenging operating environment will adversely affect asset quality, capitalisation, and profitability.
Chidambaram also asks these not to rush for bulk deposits to bloat balance sheets.
Why it is important for investors to select the right product according to their specific investment needs, risk appetite and investment tenure.
Efficient land use, minimum congestion, a focus on dharamshalas (inns) and homestays, upgrading the infrastructure while retaining the historical and cultural character of the city are some of the highlights of the plan prepared by Kukreja, the managing principal of CP Kukreja Architects.
'If the third wave of Covid infections is as bad as the second one, the market may get very polarised with a preference for blue-chips with low volatility.'
IndusInd Bank was the top laggard in the Sensex pack, falling over 5 per cent, followed by HDFC, Axis Bank, PowerGrid, SBI, Bajaj Finserv and Bharti Airtel.
Restoring the bank to its former glory will be the top priority for Vijayalakshmi Iyer, the seasoned banker who took over as chairperson and managing director of the Mumbai-based bank last month.
The country's largest lender SBI on Thursday reported a 4.20 per cent decline in consolidated December quarter net at Rs 6,257.55 crore, largely because of a higher base in the year-ago period where it had benefitted from a Rs 4,500 crore one-off income. On a standalone basis, the city-headquartered lender's net profit came in at Rs 5,196.22 crore as against Rs 5,583.36 crore in the year-ago period and Rs 4,574.16 crore in the preceding September quarter. SBI chairman Dinesh Kumar Khara told reporters that the year-ago period had seen the resolution of the Essar Steel loans, resulting in an over Rs 4,000 crore interest income and Rs 500 crore other income benefit.
'This segment has performed very well for us and this is reflected in our bounce rate which is about three to four per cent.'
Despite a significant improvement in asset quality, the country's banking industry might see its bad assets inching up in the months ahead, particularly in retail segment, global rating agency Fitch said.Rising bad loan assets had prompted many banks to sell their sticky assets to asset reconstruction companies, in order to transfer the risk and clean up their balance sheets.
Moody's cited a likely rise in the bank's non-performing assets in the near future as one of the reasons for the downgrade.
© 2026 Rediff.com - Advertise with us - Disclaimer - Privacy Policy - Sitemap - Feedback - About us - Terms of use - Grievances