There are only two PSU banks which are left among the top 100 companies on BSE in terms of market capitalisation as India's second-largest public sector bank PNB slipped out of the top 100 stack after Rs 13,600 crore fraud untangled at PNB involving fake LoU obtained by Nirav Modi group companies.
Indian Public sector banks have been under the immense burden of NPAs (non-performing assets) since the late-2015 following which Government of India introduced the mega recapitalisation plan of Rs 2.11 lakh crore to improve the lending capacities of state-run banks. Recently in the month of February, PSU banks have been badly hit by the untangling of India’s biggest banking fraud at nation’s second-largest lender Punjab National Bank. The eruption of the mega banking fraud amounting Rs 13,600 crore had a downtrodden effect on other PSU banks too. In a span of the last one-and-half-month, frauds have appeared in six other public sector banks due to escalated supervision by investigative agencies.
After the PNB fraud, government-owned bankers such as State Bank of India — India’s largest bank by assets, Union Bank of India, Allahabad Bank, City Union Bank, IDBI Bank and Andhra Bank. Taking the jitters in the sentiments of investors, PNB lost a substantial chunk of the market capitalisation in the last two months. A drop of Rs 16,057.39 crore has been observed in the market capitalisation of Punjab National Bank. At present, Punjab National Bank commands a market capitalisation of Rs 23,152.23 crore as against Rs 39,209.62 crore (12 February 2018), before the fraud.
Following the removal of PNB from the top 100 companies on Bombay Stock Exchange, there are only two PSU banks left among the top 100 pack of companies on BSE by market capitalisation. The Mumbai-based State Bank of India and the Vadodara-headquartered Bank of Baroda are the only two PSU banks left in the top 100 companies by market capitalisation. State Bank of India features among the top 10 companies on BSE holding a market capitalisation of Rs 2,15,887.67 lakh crore while Bank of Baroda is at 85th place with a market capitalisation of Rs 32,765.15 crore.
The top five companies on India’s oldest stock exchange BSE are Reliance Industries (market cap: Rs 5,59,222.99 lakh crore); Tata Consultancy Services (Rs 5,45,437.96 lakh crore); HDFC Bank (Rs 4,90,848.35 lakh crore); ITC (Rs 3,12,307.91) and Housing Development Finance Corporation (Rs 3,05,746.58 lakh crore).