(Stock Trading News) Domestic banks cosy up to stocks while MNCs play safe – Economic Times
Public sector banks – nationalised banks and the State Bank group – have started turning to stocks ever since the interest rate scenario turned southward in the past three years which made bond investment unremunerative. According to the latest bank-wise figures released by the Reserve Bank of India in its Statistical Tables Relating to Banks in India, total bank investments in stocks by the country’s commercial banks rose by 36% in FY07 from Rs 11,028. But within bank groups, nationalised banks (with the highest direct investments at Rs 9,398 crore as of March ‘07) as well as the State Bank group hiked their exposure by more than 50% during the period. Their investment dipped largely because one of the major investors of this group Standard Chartered Bank, which accounts for bulk of this group’s investments, has reduced its exposure by 95% during the year from Rs 412 crore to Rs 19 crore during the year. For the current year, though bank-wise details are not available, total investments by banks, including regional rural banks, rose 18% between end-March ‘07 and December ‘07 from Rs 18,344 crore to Rs 21,654 crore, according to figures in RBI’s weekly statistical supplement (WSS). read more
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