Reuters Market Eye - The RBI directives to meet Basel III regulations could lead to an equity dilution in banks of roughly $30-35 billion over the next five years, Macquarie says.
"Frequent dilutions will be required to support growth and also simultaneously maintain the CAR levels and capital buffers," Macquarie says.
Public banks would be especially impacted. Pension liability provisions will pull down the common equity ratio by around 50 basis points for these banks, Macquarie predicts.
View contrasts with Goldman, which on Thursday said it did not expect a significant impact from Basel III requirements on Indian banks.
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With the Nifty breaching 8,500, sentiments are again bullish. But markets have been in the 8,200-8,600 range for some time and stocks across the board do not give the required confidence except for the liquidity factor. Many frontline stocks are not participating on the upside and the core sector is in a downtrend, writes Ambareesh Baliga. Column