RBI Monetary Policy: Bank stocks fall as RBI keeps lending rate unchanged

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Bank stocks witnessed selling pressure today as the scrips fell up to 4 percent after the Reserve Bank of India kept the key policy rates unchanged.

Shares of Punjab National Bank dipped 3.68 percent, Bank of Baroda lost 2.58 percent, AXIS Bank went down by 2.19 percent, SBI lost 1.62 percent and Kotak Mahindra Bank 1.55 percent on BSE.

Led by the losses in these stocks, the BSE bank index was trading 0.55 percent down at 23,186.39 during the fag-end of the trade.

The benchmark BSE Sensex also plunged over 180 points soon after the policy announcement.

The 30-share index later pared some of the losses but was still trading in the negative at 28,286.68 points in pre-close session, down by 48.48 points or 0.17 percent over the previous close.

For the second time in a row, the RBI's Monetary Policy Committee today opted for a status quo in its key rates but shifted the stance of the monetary policy from 'accommodative' to 'neutral'.

Accordingly, the repo rate at which it lends to the system stands at 6.25 percent and the reverse repo rate at which it absorbs excess liquidity is also retained at 5.75 percent.