Shares of banks like SBI, Punjab National Bank, others edge higher on RBI action on defaulters

A day after the Reserve Bank of India (RBI) said that it had identified 12 of the largest loan defaulters and would order lenders to start bankruptcy proceedings against them, shares of banks like State Bank of India (SBI), Punjab National Bank, among others edged higher in the morning trade on Wednesday.

Shares of banks like SBI, Punjab National Bank, others edge higher on RBI action on defaulters
A man exits Punjab National Bank's building as a stray dog walks past in Kolkata. Image Source: 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. 

ALSO READ: RBI to direct banks to start bankruptcy proceedings against 12 defaulters

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

ALSO READ: RBI promises more effective steps to tackle bad loans pain

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Written By: Reuters
Updated: Wed, Jun 14, 2017
10:55 AM IST
Mumbai , Reuters
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