Bank Recapitalization – The government’s plan to infuse Rs 2.11 lakh crore into struggling state-run banks over two years is credit positive for three public sector lenders(Bank of India,Union Bank of India,and Oriental Bank of Commerce) , Moody’s said in a report revising their outlook.
Moody’s has changed the outlook to stable from negative for Bank of India and its London and Jersey branches, Union Bank of India and its Hong Kong branch, and Oriental Bank of Commerce, according to a media statement. On Nov 6th 2017 the agency also affirmed the ‘Baa3’ rating of Bank of India and Union Bank’s unsecured debt, which indicates a moderate credit risk. [ News Source : Bloomberg Quint ]
How the PSU Bank and Index Reacted to Credit Rating?
PSU Bank index is down closely 4% on Nov 7 trading session.
Bank of India – down 5.1%
United Bank of India – down 5.95%
Oriental Bank of Commerce – down 5.85%