The difficulties of the government banks, which are troubled by the loss of loan default and non-performing assets (NPAs), are not ending. Public sector banks lost a total of 87,300 crores during the financial year ending March this year. According to the figures released by the banks, during the last financial year alone, only 21 Indian banks and Vijaya Bank were in profit, while the rest 19 banks had to face losses. Among these, the condition of PNB and IDBI Bank is the worst.
According to the data, Rs 1,258.99 crore of Indian Bank and Rs 727.02 crore of Vijaya Bank will reduce profits, the net loss of public sector banks in the last financial year is Rs 85,370 crore. However, after the repeated scandals, the situation with NPA has become very clear and efforts to deal with it have also been started, which has led to the hope that gradual normalization of the situation has started.
Arun Kejriwal, secretary of Kejriwal and Investment Services, points out that in view of the problems of banking sector coming up one by one, it can be said that the existing merger of the government banks is at least two-quarter It may take time. He said that the good condition is that efforts have been started in this direction. Significantly, the government banks facing losses are working on the plan to sell their non-core assets, along with the recovery of debt so that the required standard of capital adequacy can be retained.
For instance, PNB (Punjab National Bank) will sell its stake in PNB Housing and other units BSE, Icra and Crisil recently. On the other hand, the government is engaged in efforts to ensure the availability of capital in banks through the bailout package. 2.11 lakh crore for the financial condition of the banks, the first instalment has been released and the second instalment from the government has to be announced.
Kejriwal points out, "Obviously the banks whose condition is worse, they will get more money. But the bailout package will be preferred to those banks who have made efforts to raise capital on their behalf. " After the scandals are exposed, the majority of the listed companies in the market are trading at their lowest level or around it.
Talking about the past six months, PNB Bank's share was 51 per cent, Bank of Baroda's share was 26 per cent in the last six months, State Bank of India 15.3 per cent in the past 6 months and Allahabad Bank's shares fell nearly 41 per cent in the past 6 months. In such a situation, there is a situation of a dilemma in front of the investors.
Kejriwal points out, "In view of the shocking situation, due to the bad condition of the government banks, investors should wait for the situation to improve. Unless the situation improves, investors should stay away from the purchase or sale of shares of government banks. "
Kejriwal points out that the "abnormal" conditions of government banks are two ways of getting normal. The first is that the government should work to fill the pit by putting money in the banks or work to repair its balance sheet through bank recovery. But the main function of banks is banking, and in this case, it raises the money by dividing its non-banking companies.