Share price movement

 NSE PSU Bank index soared 24% intraday, led by gains

in SBI, PNB, Bank of Baroda, Bank of India and Union Bank,
among others, while NSE Private Bank index is up 35%.
Benchmark indices Sensex and Nifty jumped 20-21% in the
same period.
 PNB has gained 46 per cent since October 24, when the
recapitalisation plan was rolled out by the government.
 Even as stocks of other public sector banks (PSBs) pared
some gains on Thursday, PNB was an exception with an up move of
5.6 per cent.

Reasons for the surge

 The government announcement was a much-needed

stimulus package, which could shore up the sluggish credit
growth at public sector undertaking (PSU) banks and help
kick-start the economy.
 Analysts said the top-up plan was long-awaited for
PSU banks that have been reeling under a pile of non-
performing loans (NPLs), which was blocking their growth
plans.
 The decision to recapitalise PSBs (public sector banks) with Rs 2.11 lakh crore was expected
to address the bank balance sheet problem and push growth forward.

 PNB being a capital-starved bank among the top-rung PSBs, the government’s plan to infuse
money was a positive.