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Stocks of private sector banks are expected to remain under pressure next week due to the shadow of alleged money laundering by its employees, but public sector banks are seen trading with a positive bias eyeing cues from the Reserve Bank of India's monetary policy review on Tuesday. Stocks of ICICI Bank, HDFC Bank and Axis Bank have performed weakly and fallen 2.7-6.3% this week. The sting showed branch personnel of the three largest private banks in the country offering tips and suggestions to prospective customers for laundering their black money and bringing it into the regular banking system. All three banks have indicated that they will conduct internal probes into the allegations. The RBI, and finance ministry are in touch with these banks and have promised stern action in case the allegations are substantiated. Banking stocks, especially state-owned banks, are also keenly awaiting the RBI monetary policy review on Tuesday amid rising hopes that the central bank may take steps to ease rates and improve liquidity in the system. Recent comments by the Reserve Bank of India Governor D. Subbarao and positive announcements from Finance Minister P. Chidambaram have also raised hopes of a policy rate reduction to boost growth prospects in the country.
Stocks of private sector banks are expected to remain under pressure next week due to the shadow of alleged money laundering by its employees, but public sector banks are seen trading with a positive bias eyeing cues from the Reserve Bank of India's monetary policy review on Tuesday. Stocks of ICICI Bank, HDFC Bank and Axis Bank have performed weakly and fallen 2.7-6.3% this week. The sting showed branch personnel of the three largest private banks in the country offering tips and suggestions to prospective customers for laundering their black money and bringing it into the regular banking system. All three banks have indicated that they will conduct internal probes into the allegations. The RBI, and finance ministry are in touch with these banks and have promised stern action in case the allegations are substantiated. Banking stocks, especially state-owned banks, are also keenly awaiting the RBI monetary policy review on Tuesday amid rising hopes that the central bank may take steps to ease rates and improve liquidity in the system. Recent comments by the Reserve Bank of India Governor D. Subbarao and positive announcements from Finance Minister P. Chidambaram have also raised hopes of a policy rate reduction to boost growth prospects in the country.
