Axis Bank posted treasury gains of Rs 916 crore while ICICI Bank posted treasury profit of Rs 768 crore. If you look at even corporate bonds, yields have come down significantly, plus the equity market has also remained very buoyant. The three state-run banks, which together posted a profit of Rs 614 crore, made treasury gains of Rs 1,374 crore. "There are unbooked treasury profits among banks, where realisation will happen when they sell bonds in the coming quarters (with dipping yields)." In fact, as yields plunge, it could well be a replay of the early 2000, when rallying bonds helped banks get over the nightmare of bad loans.Top eight banks analysed by ET revealed that treasury gains alone contributed nearly half to the banks' profits.

Source: Economic Times August 01, 2016 05:37 UTC