MUMBAI: Bank stocks stretched its weakening trend for the second consecutive session today, dropping as much as 2.3 per cent, amid reports that the RBI asked the banks to go for higher provisioning against stressed loans referred to the insolvency court.
Shares of Central Bank of India dipped 2.30 per cent, followed by State Bank of India (1.07 per cent), Bank of Maharashtra (0.54 per cent), Federal Bank (0.53 per cent), Punjab National Bank (0.47 per cent) and HDFC Bank (0.11 per cent) on BSE.
Among others, Syndicate Bank fell 0.21 per cent and Kotak Mahindra Bank dropped 0.04 per cent.
Reports suggest that the central bank has asked the lenders to set aside additional capital against stressed assets that have been referred for insolvency proceedings.
Bank stocks were down up to 5 per cent in the previous trading session.
The BSE benchmark Sensex today plunged 124 points to close at 30,834.32.
"Banks NPA woes and expectation of higher cost on consumer durables post GST roll-out have kept the market in the red," said Vinod Nair, Head of Research, Geojit Financial Services Ltd