MUMBAI: Bank stocks were the biggest losers on Wednesday with the Nifty Bank index crashing to a three-year low. The biggest loser was IndusInd Bank, which has seen its scrip hammered in recent days, followed by Kotak Mahindra Bank and HDFC Bank — which saw its sharpest one-day drop of 10%.
HDFC Bank on Wednesday hit its 2017 low of Rs 878, losing over 40% from its adjusted 52-week high of Rs 1,304. Investor wealth worth nearly Rs 50,000 crore was wiped out due to the fall in HDFC Bank.
On Wednesday, the Supreme Court’s statement that no relief should be granted to telecom companies triggered asset-quality fears.
Another key driver for the crash was the expectation that banks would be hit by a fresh round of NPAs in both corporate as well as retail segments due to the sudden drop in economic activity amid the coronavirus shutdown.
IndusInd Bank sought to battle market rumours on its telecom-sector exposure by issuing a clarification. “Market rumours about individual exposures doing the rounds are bloated and outlandish and nowhere near the truth,” it said.