February 14, 2018 / 4:47 AM / 3 months ago

BUZZ-India's state-run banks fall on RBI's new bad-loan regulations

** Shares of India’s state-run banks fall after RBI late on Monday announced a new bad-loan-resolution framework

** The RBI’s rules will push more large loan defaulters to bankruptcy courts, abolish a slew of existing loan-restructuring mechanisms

** Move will lead to spike in credit provisioning, hurt balance sheets in short-term, but will help reduce bad debts by forcing lenders to be more aggressive - analysts ** “Credit provisions to spike up further as RBI steps up the pace for resolution of stressed assets” - ratings agency ICRA

** Nifty PSU bank index falls as much as 2.3 pct, State Bank of India down 1.8 pct

** Bank of India is top pct loser on Nifty PSU bank index after posting Q3 net loss on Monday, hurt by a surge in provisions for bad loans

** Punjab National Bank falls as much as 5.7 pct after detection a $1.77 bln worth of fraudulent transactions

** Indian markets were shut on Tuesday for a holiday

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