RBI cuts CRR by 50 basis points, Banking stocks reacts with positive outcome

The Reserve Bank of India (RBI) has maintained its repo rate at 6.50 percent for the 12th consecutive time. In his address following the central bank's 52nd Monetary Policy Committee meeting, RBI Governor Shaktikanta Das announced several important updates. Notably, the RBI has reduced the Cash Reserve Ratio (CRR) by 50 basis points, lowering it from 4.5 percent to 4 percent.

The CRR indicates the portion of deposited funds that banks must hold in reserve. A decrease in this rate allows banks to have more lending capacity. 

The banking sector has responded positively to these significant changes. Axis Bank, a privately held bank based in Mumbai, was one of the biggest gainers, with its shares rising by 1.58 percent, or Rs 18.40. This increase brought the total value of Axis Bank's shares to Rs 1,184.80 each.

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Among the Public Sector lenders, the Bank of Baroda gained the most among PSBs. The shares of BoB rose by 1.38 percent or Rs 3.59. This took the overall value of the bank's shares to Rs 263.57 per share.

The biggest lender in the country, the government-owned State Bank of India had a relatively lukewarm reaction to the developments from the RBI building. The shares of SBI make marginal gains of 0.17 percent or Rs 1.45, taking the overall value of the shares to Rs 866.90.

ICICI Bank also witnessed a similar movement at Dalal Street in the intraday trade on Friday. The shares of the Mumbai-based bank gained only by 0.11 percent or Rs 1.50, spiking its overall value to Rs 1,338.00 per share. PNB shares also rose by 1.18 percent or Rs 1.29. This tool has an overall value of Rs 110.37 per piece. 

 

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