India's Federal Bank, South Indian Bank drop after cenbank restrictions

Federal Bank

14/03/2024 04:06

** Shares of Federal Bank  FED.NS  and South Indian Bank
 SIBK.NS  down 4.3% and 1.9%, respectively
    ** India's central bank asked SIBK and FED to stop adding
new customers to their co-branded credit cards, the lenders said
in separate stock exchange filings
    ** SIBK was down as much as 3.8% before paring some losses
    ** FED and SIBK on track to drop in fifth and sixth straight
sessions, respectively, if trend holds
    ** Nomura says restrictions unlikely to have near-term NIM
impact on FED but is a near-term dampener to brokerage's outlook
that scale-up of unsecured retail is key driver for incremental
loan growth and NIM expansion over FY24-26
    ** Brokerage maintains "Buy" rating on FED and PT of 190
rupees; it does not have a rating on SIBK
    ** FED and SIBK both have avg analyst rating of "Buy" - LSEG
data

 (Reporting by Varun Vyas in Bengaluru)
 ((varunvyas.hebbalalu@thomsonreuters.com))