Latest News | Bank Stocks Gain After SC's Moratorium Verdict
Get latest articles and stories on Latest News at LatestLY. Bank stocks gained on Tuesday after the Supreme Court declined to extend the loan moratorium period and said complete waiver of interest is not possible.
New Delhi, Mar 23 (PTI) Bank stocks gained on Tuesday after the Supreme Court declined to extend the loan moratorium period and said complete waiver of interest is not possible.
Bandhan Bank rose by 3.36 per cent, IndusInd Bank gained 2.28 per cent, ICICI Bank 2.25 per cent, HDFC Bank 2.11 per cent, Axis Bank 2.02 per cent, State Bank Of India 1.48 per cent, Federal Bank 1.30 per cent, and RBL Bank 0.69 per cent.
The BSE Bank index gained 1.51 per cent to close at 38,462.48.
"It is a mixed bag as it adds reassurance to the banking industry by not extending moratorium but no compound interest, irrespective of the size of the loan, will lead to a write-down in revenue. Few segments of the economy are still under stress, further restructuring is required as there is an increasing risk of further rise in NPAs, as expected," Vinod Nair, Head of Research at Geojit Financial Services.
The apex court on Tuesday refused to interfere with the Centre's and RBI's decision to not extend the loan moratorium beyond August 31 last year, saying it is a policy decision.
A bench headed by Justice Ashok Bhushan said that the top court cannot do judicial review of the Centre's financial policy decision unless it is malafide and arbitrary.
It also directed that no compound or penal interest be charged during the six-month moratorium period, but added that complete waiver of interest is not possible as it will have huge financial implications.
(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)