Expect $30-35 bln equity dilution from Basel III - Macquarie

Fri May 4, 2012 11:21am IST

People perform transactions at a bank in Srinagar August 19, 2008. REUTERS/Fayaz Kabli/Files

People perform transactions at a bank in Srinagar August 19, 2008.

Credit: Reuters/Fayaz Kabli/Files

Related Topics

Stocks

   

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.

FILED UNDER:

Reuters Showcase

GDP Growth

GDP Growth

India revises up 2013/14 GDP growth to 6.9 percent.  Full Article 

Adani Restructuring

Adani Restructuring

Adani hives off power, ports businesses to boost growth.  Full Article 

Bank of Baroda

Bank of Baroda

Q3 net profit down 69 pct on higher provisions  Full Article 

Trading Fees

Trading Fees

BSE slashes fees in FX derivatives battle with NSE  Full Article 

SpiceJet Turnaround

SpiceJet Turnaround

SpiceJet board approves up to $243 mln share sale plan  Full Article 

Currency Market

Currency Market

RBI urges companies to hedge FX exposure  Full Article 

Banking Sector

Banking Sector

Banks say no room to cut lending rates, thwarting RBI easing  Full Article 

ICICI Results

ICICI Results

ICICI sets quarterly record profit as Q3 net rises 14 pct  Full Article 

Reuters Poll

Reuters Poll

RBI seen holding rates steady on Tuesday, minority of analysts expect cut  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage