Banking stocks were trading higher as rating agency ICRA’s latest report stated that overall net non-performing assets (NPAs) of the banking sector are likely to improve by the end of this fiscal (FY20).
State Bank of India is currently trading at Rs. 337.00, up by 7.15 points or 2.17% from its previous closing of Rs. 329.85 on the BSE. The scrip opened at Rs. 333.60 and has touched a high and low of Rs. 338.30 and Rs. 333.05 respectively. So far 715811 shares were traded on the counter.
Bank of Baroda is currently trading at Rs. 103.55, up by 4.55 points or 4.60% from its previous closing of Rs. 99.00 on the BSE. The scrip opened at Rs. 99.95 and has touched a high and low of Rs. 104.20 and Rs. 99.75 respectively. So far 1157700 shares were traded on the counter.
ICICI Bank is currently trading at Rs. 545.65, up by 6.65 points or 1.23% from its previous closing of Rs. 539.00 on the BSE. The scrip opened at Rs. 540.00 and has touched a high and low of Rs. 547.10 and Rs. 538.30 respectively. So far 407191 shares were traded on the counter.
Rating agency ICRA said in its latest report has said that overall net non-performing assets (NPAs) of the banking sector are likely to improve to 3.2-3.3 per cent by the end of this fiscal from 3.8 per cent in FY19 on account of better recoveries and declining slippages. A report stated that the asset quality for the banking sector continues to improve with declining slippages and expected improvements in recoveries during FY20 even though loan write-offs continue to remain at elevated levels.
It mentioned that the decline in net NPAs will improve the solvency profile of banks, with core equity bettering to around 29 per cent by March 2020 and nearly 27 per cent by March 2021 from 33 per cent as on September 30, 2019. The report said with sizeable capital infusion in public sector banks and accelerated provisions, their NNPAs declined sharply to 4.8 per cent as on September 30, 2019 from 7.2 per cent as on September, 2018 and 4.9 per cent as on March 31, 2019.
Private lenders net NPAs improved to 1.7 per cent as on September 30, 2019 from 1.9 per cent as on September 30, 2018, but were marginally higher than 1.6 per cent as on March 31, 2019. The report said with reduction in net bad loan levels, credit provisions for banks are expected to decline to 1.6-1.8 per cent of advances in the current fiscal and 0.8-0.9 per cent during FY2021 from 3.6 per cent during FY2019. The decline in the credit provisions will largely be driven by state-run banks with their provisioning declining to 2.1-2.3 per cent in FY2020 and to 1-1.1 per cent in FY2021 from 4.4 per cent during FY2019.
| Company Name | CMP |
|---|---|
| SBI | 1080.35 |
| PNB | 114.50 |
| Canara Bank | 142.35 |
| Bank Of Baroda | 280.00 |
| Union Bank Of India | 188.90 |
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