Shares Of Small Private Sector Banks Get Pounded On Poor Numbers

Published: Friday, May 11, 2018, 13:21 [IST]

Stocks of smaller private sector players are falling very rapidly, as quarterly numbers failed to meet expectations.

On Thursday, Federal Bank reported a poor set of quarterly numbers that lagged estimates.

Shares Of Small Private Sector Banks Get Pounded On Poor Numbers

The shares of the bank fell nearly 10 per cent. This had a huge impact on other private sector banking stocks, with Karnataka Bank falling 4 per cent. Laxmi Vilas Bank, another private sector player, also saw its share price drop sharply. However, we are seeing some buying on Friday morning, though some of the shares had fallen dramatically on Thursday.

Federal Bank shares fell after its March quarter net profit dropped an annual 44 per cent due to a sharp rise in bad loan provisioning. Federal Bank recognised Rs 872 crore of slippage in January-March to comply with the requirements as stipulated by the country's central bank.

Karnataka Bank is now slated to declare its results on May 15 and markets would await to see, if non performing assets of these smaller private bank players surge.

Some of these stocks have already fallen significantly from 52-week highs. Other private sector players like Karur Vysya Bank's quarterly numbers are awaited. Analysts would be keen to watch for provisionings after the numbers.

GoodReturns.in

Story first published: Friday, May 11, 2018, 13:21 [IST]

Other articles published on May 11, 2018