By Aditya Raghunath
Investing.com -- Nifty Bank fell for a second straight day as fears for bad loans continued to rise on the surge of COVID-19 cases. Bank Nifty closed at 31,112, down 0.31%, after falling 2.4% on April 19. Multiple states have imposed lockdowns and curbs that have severely impacted economic activity in the country.
India has recorded 2.6 lakh cases in the last 24 hours, and many cities are seeing a collapse of medical infrastructure. A report in Financial Express said that half the factories in Maharashtra are shut or on the verge of shutting down. Maharashtra contributes around 13% of India’s GDP. The loss to MSMEs (micro, small and medium enterprises) is severe, and if bad loans start to pile up here, banks will be badly hit.
Both, private and public sector banks, have taken hits. PSU banks are more severely impacted. Since the start of April, HDFC Bank Ltd (NS: HDBK ) has lost 6.9%, AXIS Bank Ltd (NS: AXBK ) is down 6.55% and ICICI Bank Ltd (NS: ICBK ) is down 4.89%.
State Bank Of India (NS: SBI ) is down 9.6%, Punjab National Bank (NS: PNBK ) is down 8% and Bank of Baroda Ltd (NS: BOB ) is down 14.8%. Small finance banks have been hit the hardest. AU Small Finance Bank Ltd (NS: AUFI ) is down 15.3% while Equitas Small Finance Bank (NS: EQUI ) is down 15%.
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This is the all round and global crisis of capitalism that will make the 2008 financial crisis look loke a picnic.Like 4