Bank Stocks Outlook for the week – 02 to 06.01.2017
Bank Stocks Outlook for the week – 02 to 06.01.2017
( www.rupeedesk.in )
Next week, bank stocks are seen trading range-bound with a negative bias due to lack of sector-specific triggers. However, any new announcements on demonetized currency notes by Prime Minister Narendra Modi on Saturday might provide fresh triggers. Fresh announcements on withdrawal limits from banks are likely, as the deadline for banks to accept deposit of old notes expired yesterday. The Reserve Bank of India yesterday said that withdrawn 500- and 1,000-rupee currency notes cannot form part of banks' cash balances from Saturday.
Banks' deposits have surged since the government withdrew the legal tender status of high-denomination currency notes. Limits on currency withdrawal are expected to be lifted in a phased manner, and this is seen positive for banks as a sudden relaxation might affect banks' operations. Banks have asked the government and the Reserve Bank of India to continue the withdrawal limits on cash beyond Dec 30, till there is adequate availability of currency notes in the system. Earlier, State Bank of India Chairman Arundhati Bhattacharya had said that the bank's ability to dispense cash was limited to the quantum available with it and, therefore, irrespective of whether restrictions on cash withdrawal were lifted or not, its paying ability would remain constrained.
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Bank Stocks Outlook for the week – 02 to 06.01.2017
( www.rupeedesk.in )
Next week, bank stocks are seen trading range-bound with a negative bias due to lack of sector-specific triggers. However, any new announcements on demonetized currency notes by Prime Minister Narendra Modi on Saturday might provide fresh triggers. Fresh announcements on withdrawal limits from banks are likely, as the deadline for banks to accept deposit of old notes expired yesterday. The Reserve Bank of India yesterday said that withdrawn 500- and 1,000-rupee currency notes cannot form part of banks' cash balances from Saturday.
Banks' deposits have surged since the government withdrew the legal tender status of high-denomination currency notes. Limits on currency withdrawal are expected to be lifted in a phased manner, and this is seen positive for banks as a sudden relaxation might affect banks' operations. Banks have asked the government and the Reserve Bank of India to continue the withdrawal limits on cash beyond Dec 30, till there is adequate availability of currency notes in the system. Earlier, State Bank of India Chairman Arundhati Bhattacharya had said that the bank's ability to dispense cash was limited to the quantum available with it and, therefore, irrespective of whether restrictions on cash withdrawal were lifted or not, its paying ability would remain constrained.
