Mumbai: Shares in state-run banks fell sharply on Friday after Punjab National Bank and Union Bank posted a sharp rise in non-performing assets, sparking fears about the quality of assets in the government-owned sector.
The performance of state-run banks contrasted with private lenders after ICICI Bank said on Friday non-performing assets fell in the April-June quarter. Shares in India's biggest private lender rose 2.1 per cent.
The results showed private banks are better placed for profit growth in the current environment than government-owned banks, whose lending decisions are not always driven by commercial considerations.
In contrast to ICICI, Punjab National Bank said on Thursday net non-performing assets rose in the previous quarter. Shares in the regional lender dropped 4.5 per cent.
Union Bank also recorded a surge in bad assets, sending its shares down 6.6 per cent.
Punjab and Union Bank's results hit State Bank of India, which fell 2.2 per cent. The country's biggest lender has not announced a date for its earnings results.
Copyright Thomson Reuters 2012
The performance of state-run banks contrasted with private lenders after ICICI Bank said on Friday non-performing assets fell in the April-June quarter. Shares in India's biggest private lender rose 2.1 per cent.
The results showed private banks are better placed for profit growth in the current environment than government-owned banks, whose lending decisions are not always driven by commercial considerations.
In contrast to ICICI, Punjab National Bank said on Thursday net non-performing assets rose in the previous quarter. Shares in the regional lender dropped 4.5 per cent.
Union Bank also recorded a surge in bad assets, sending its shares down 6.6 per cent.
Punjab and Union Bank's results hit State Bank of India, which fell 2.2 per cent. The country's biggest lender has not announced a date for its earnings results.
Copyright Thomson Reuters 2012
