Oriental Bank of Commerce plunged to a 52-week low of Rs 159.30 on the National Stock Exchange, while other PSU banking stocks that joined Oriental Bank at one-year lows were Union Bank of India at Rs 137.25, Dena Bank at Rs 59.15, Canara Bank at Rs 282 and Central Bank of India at Rs 55.50, and State Bank of India at Rs 1761.
Markets are worried that the economic slowdown will take a toll on the non performing assets of banks. Compounding the worries for banks from the sector are the recent RBI measures to strengthen the rupee, which are set to choke liquidity and put pressure on margins.
Along with PSU banks, private sector banks were also exhibiting a weak trend today with notable losers being Indusind Bank and HDFC Bank.
It's unlikely that banking stocks would recover any time soon, given the concerns over asset quality and deteriorating economic conditions.