RBI promotes liquidity of ₹ 60,000 crore at one time: BNP Paribas Analyst – CNBC TV18

Santanu Chakraborty, in India’s analyst-banking, financial services and insurance (BFSI) at BNP Paribas, described the Reserve Bank of India (RBI). The liquidity of 60,000 crores indicates a change in policy at a time and as a positive step.

On January 27, RBI announced steps to manage the flow of money in the market. The Central Bank has planned to purchase bonds worth ₹ 60,000 crore through Open Market Operations (OMO). It will be in three parts of ₹ 20,000 crore on 30 January, 13 February and 20 February.

Chakraborty said that the lack of liquidity due to RBI’s dollar sales was largely. Although this liquidity boost can not immediately address the credit hunger of banks, it is an important step in reducing financial pressures.

Also read: Nifty Bank promotes liquidity of ₹ 1.5 lakh crore from RBI

He also highlighted the strong performance of ICICI Bank and HDFC Bank, despite the situation of tight liquidity, credited his strong liability franchise for his success.

Bernstein’s senior analyst-India Financial, Pranav Gundplele, who also participated in the discussion, shared his approach by estimating the 50-base-point rate cut by the RBI in the first half of the year. He said that while remedies for liquidity and potential rate cuts can initially hurt banks by compressing net interest margin (NIMS), they would eventually support an increase in demand for loan and increase in consumption in long periods.

In terms of investment preferences, the top pics of Gundalepal between large banks and NBFCs include HDFC Bank, followed by IndusInd Bank, ICICI Bank, Axis Bank, SBI and Kotak Mahindra Bank. He advised to take precautions on pure consumer lenders like SBI Card or Bajaj, banning investment in this segment.

For complete discussion, watch videos together