Indian banking shares surge on govt's PSB recapitalisation plan

Key highlights:

• Indian banking shares soared on Wednesday
• The cabinet approved a Rs 2.11 lakh crore plan to recapitalise its state banks over the next two years
• State Bank of India shares rose more than 20%,

Indian banking shares soared on Wednesday, sending indexes to record highs after the cabinet approved a $32.43 billion (Rs 2.11 lakh crore) plan to recapitalise its state banks over the next two years, although bonds fell given the injection will be funded with debt.

State Bank of India, the biggest lender, rose more than 20%, while Punjab National Bank
, the second biggest state-run lender, surged more than 33%.

The benchmark NSE Nifty rose as much as 1.3% to a record high of 10,340.55, while the BSE Sensex climbed as much as 1.6% to a record high of 33,117.33.

Bonds fell, with the benchmark 10-year bond yield up 3 basis points to 6.81 percent from its previous close.($1 = 65.0800 Indian rupees)

(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)