The morale as well as investor perception of nationalised banks has never been worse. I make a distinction between PSU and nationalised banks. SBI and IDBI Bank are PSUs, but not nationalised banks. Credit ratings will keep moving downward, driving cost of fund upward.In the current situation, only resolute bold measures taken quickly can save these nationalised banks from extinction. The well-run private banks command 3x BV.It can save huge money required to keep banks capital above water but fetch a huge proceed by divestment.

Source: Economic Times March 08, 2018 18:32 UTC