SBI down by another 4%; loses Rs 4,535 cr in M-cap
   
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SBI down by another 4%; loses Rs 4,535 cr in M-cap

Last Updated: Wednesday, October 5, 2011, 20:34
 
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SBI down by another 4%; loses Rs 4,535 cr in M-cap
Mumbai: After its downgrade by ratings firm Moody's, SBI's stock was hammered for the second day Wednesday on BSE, eroding over Rs 4,535 crore in market valuation.
     
SBI shares ended the day 4 percent lower to settle at Rs 1,715.30 on BSE. It had lost by the same margin Tuesday, too.
     
The state-run bank has lost about Rs 8,000 crore in two days in market capitalisation which stood at Rs 1,08,921 crore at the end of Wednesday's trade.
     
The stock was down by over 4.37 percent to a 52-week low of Rs 1,708.55 a share on BSE.
     
On the National Stock Exchange, the scrip dipped to a 52-week low of Rs 1,710 a share intra day, before closing 4.22 percent down at Rs 1,711.85.
    
Global ratings firm Moody's Tuesday downgraded the rating of SBI financial strength by one notch to 'D+' due to low tier-I capital ratio and deteriorating asset quality. Moody's cited a likely rise in the bank's non-performing assets in the near future as one of the reasons for downgrade.
     
State Bank of India Chairman Pradip Chaudhuri Wednesday asked the government to expeditiously approve the bank's rights issue proposal to help it shore up capital by about Rs 20,000 crore.
     
The downgrade will make overseas borrowings costlier for the state-owned lender.
     
"It (rating action) is a reminder to the bank and all the shareholders that the recapitalisation measure requires greater urgency," Chaudhuri told reporters.
     
The standalone rating for SBI's private sector peers like ICICI Bank, HDFC Bank and Axis Bank stands at 'C-'.

PTI



First Published: Wednesday, October 5, 2011, 12:50


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