Gainers from demonitisation make it big: PSU banks buzzing on bourses

Equity markets are probably discounting the effects of demonetisation and investors are trying to understand the sectoral impact of demonetisation.

Even as it is widely speculated that banking is the single industry that will benefit from the demonetisation move by PM Narendra Modi atleast in the short run, the shares of PSBs are gaining ground on bourses.

SBI, Bank of Baroda, SBBJ, Vijaya Bank are all up by more than one per cent on Thursday even as markets are trading in red with Sensex down by almost 97 points at 25954 on an intraday basis. 

The banking system has so far received deposits more than 5.44 lac crores and the major chunk of it is with the PSBs.

There is every chance that the deposit rates will be cut by the banks, as SBI has already announced cuts in bulk deposit rates, and eventually the lending rates may also come down as the MCLR (Marginal cost of lending rates) comes down for the banks.

Investors with long term perspective can focus on those banks which are able to bring on board several of its customers on a digital platform.