Shares of 10 banks fell by 0.03% to 1.07% at 11:21 IST on BSE after the Reserve Bank of India left key interest rates unchanged at the First Bi-monthly Monetary Policy Statement, 2014-15 today, 1 April 2014.
IDBI Bank (down 1.07%), Kotak Mahindra Bank (down 1.03%), Punjab National Bank (down 0.8%), Union Bank of India (down 0.58%), State Bank of India (down 0.35%), HDFC Bank (down 0.33%), ICICI Bank (down 0.28%), Federal Bank (down 0.26%), Bank of India (down 0.04%) and IndusInd Bank (down 0.03%), edged lower.
Bank of Baroda (up 1.16%), Axis Bank (up 0.52%), Yes Bank (up 0.28%) and Canara Bank (up 0.08%), edged higher.
The S&P BSE Bankex was down 0.14% at 14,552.46. It underperformed the S&P BSE Sensex, which was down 0.06% at 22,372.75.
The S&P BSE Bankex had outperformed the market over the past one month till 31 March 2014, rising 18.63% compared with the Sensex's 5.99% rise. The index had also outperformed the market in past one quarter, rising 12.08% as against Sensex's 5.74% rise.
In a statement, the Reserve Bank of India (RBI) said that it has decided to keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 8% and keep the cash reserve ratio (CRR) of scheduled banks unchanged at 4% of net demand and time liability (NDTL).
RBI has also decided to increase the liquidity provided under 7-day and 14-day term repos from 0.5% of NDTL of the banking system to 0.75%, and decrease the liquidity provided under overnight repos under the LAF from 0.5% of bank-wise NDTL to 0.25% with immediate effect.
Consequently, the reverse repo rate under the LAF will remain unchanged at 7%, and the marginal standing facility (MSF) rate and the Bank Rate at 9%, RBI said.
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