NSE bank index rose as much as 4.3 pct to life high of 19,410.40.
The Reserve Bank of India cut interest rates on Thursday by 25 basis points to 7.75 percent in a surprise inter-meeting cut.
Read StanChart Report: RBI likely to ease further
Read SBI Report: Beginning of a rate easing cycle
Rate cut seen stoking credit growth and lowering costs for lenders, say analysts.
In pics: Check out what happened last month when Raghuram Rajan refused to cut rates
Possibility of 50-100 bps cut in rates over next few quarters, believe fund managers.
* Lone ranger Raghuram Rajan fights for RBI autonomy amid rate cut rants
* Dec 2 meet: When Raghuram Rajan refused to cut rates
* Dec 2 meet: On interest rates, markets proposed, RBI Guv Raghuram Rajan disposed
* RBI can’t flip-flop on interest rate: Raghuram Rajan
India finmin welcomes RBI rate cut as inflation drops.
ICICI Bank gains as much as 5.7 pct while State Bank of India rises as much as 6.2 pct.