Bank stocks in heavy demand; IndusInd Bank jumps nearly 7 pc

New Delhi, Apr 15 (PTI) Bank stocks were in the limelight on Tuesday, with IndusInd Bank surging nearly 7 per cent, in tandem with a rally in the broader market.

Shares of IndusInd Bank jumped 6.84 per cent, Axis Bank rallied 4.18 per cent, HDFC Bank climbed 3.23 per cent and ICICI Bank went up by 2.86 per cent on the BSE.

The stock of Canara Bank advanced 2.40 per cent, Yes Bank (2.10 per cent), State Bank of India (1.23 per cent), Bank of Baroda (1.10 per cent), Federal Bank (0.84 per cent) and Kotak Mahindra Bank (0.44 per cent).

The BSE Bankex index jumped 2.51 per cent to 59,866.95.

“Banking stocks benefited from deposit rate cuts,” Vinod Nair, Head of Research at Geojit Investments Limited, said.

Rallying for the second straight session on Tuesday, the 30-share BSE Sensex jumped 1,577.63 points or 2.10 per cent to settle at 76,734.89. The NSE Nifty surged 500 points or 2.19 per cent to 23,328.55.

The country’s largest lender State Bank of India (SBI) has reduced its lending rate by 25 basis points following the Reserve Bank’s policy rate cut, making loans cheaper for both existing and new borrowers.

With the latest round of reduction, the Repo Linked Lending Rate (RLLR) of SBI would come down by 25 basis points to 8.25 per cent.

The rate reduction is in response to last week’s RBI slashing key interest rate by 25 basis points for the second time in a row to support growth facing the threat of reciprocal tariffs by the US.

Besides, the bank cut deposit rates by 10-25 basis points, which will again be effective from April 15.

Meanwhile, private sector major HDFC Bank has lowered interest rate on savings accounts by 25 basis points to 2.75 per cent which is the lowest among peers in the private sector.

Another public sector Bank of India has withdrawn its 400-day special deposit scheme which offered 7.3 per cent. Mumbai-based Bank of India has announced a reduction of 25 basis points in its home loan interest rates, benefitting both new and existing customers.