SBI results keep PSU banking stocks under pressure

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 SBI results keep PSU banking stocks under pressure
Bank of Baroda: Quotes, News
BSE 147.10BSE Quote1.25 (0.85%)
NSE 147.20NSE Quote1.05 (0.71%)
Canara Bank: Quotes, News
BSE 333.00BSE Quote3 (0.90%)
NSE 332.70NSE Quote2.4 (0.72%)
Asset quality concerns for India's largest lender State Bank of India saw stocks of other PSU banking stocks trading sharply lower in trade today.

Bank of Baroda was down 3%, Punjab National Bank was down more than 2% and Canara Bank was down 0.70% at 2.50 pm IST, weighed down largely by poor asset quality of SBI.

Asset quality concerns have weighed on PSU banks, which have reported a higher gross non performing assets. SBI reported gross non performing assets of 4.99%, which disappointed the markets. The Bank saw its net NPA rise to 2.22%, as against 1.11% reported in the corresponding period of last year.

Analysts believe that the asset quality of banks could deteriorate even further given the economic downturn in the country. They opine that with drought like conditions throughout the country, there could be greater defaults from the agricultural sector. This could mean that the asset quality of banks could become worse in the coming quarters.

Read more about: sbi
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