Bank stocks plunge on loan waiver announcement

Written by Agencies | Mumbai, February 29: | Updated: Feb 29 2008, 18:03pm hrs
Bank stocks fell 3 per cent to 9,763.90 points in late afternoon trade on Friday after the Finance Minister P Chidambaram announced a loan waiver for farmers.

The biggest loser among the banks was state-run Bank of India, which was down 3.28 per cent at Rs 339 at 1250 hrs on the Bombay Stock Exchange.

Country's largest lender State Bank of India dropped nearly two per cent and was trading at Rs 2,000. The largest private lender ICICI Bank dipped 2.63 per cent and was trading at Rs 1,074.

Punjab National Bank fell 2.63 per cent, while Union Bank dropped 2.67 per cent.

Chidambaram announced a Rs 60,000-crore relief package for farmers, including complete waiver of loans given to small and marginal farmers.

He proposed to waive agricultural loans given by scheduled commercial banks, regional rural banks and cooperative credit institutions to farmers up to March 31, 2007 and due for December 31.