After opening the day in green share markets in India witnessed choppy trading activity and are presently trading above the dotted line. Sectoral indices are trading on a mixed note, with stocks in the banking sector and stocks in the PSU sector witnessing maximum buying interest. While stocks in the capital goods sector are leading the losses.

The BSE Sensex is trading up by 65 points (up 0.2%) and the NSE Nifty is trading up by 15 points (up 0.1%). Meanwhile, the BSE Mid Cap index is trading up by 0.1%, while the BSE Small Cap index is trading up by 0.3%. The rupee is trading at 67.05 to the US$.

In news from stocks in the banking sector. ICICI Bank share price is among the top gainers today after the company declared results for the March 2018 quarter.

ICICI Bank, India’s largest private sector lender by assets reported 49.6% YoY drop in standalone profit at Rs 10.2 billion for the March quarter on sharp rise in provisions for the bad loans.

Provisions for the quarter went up by 129% to Rs 66 billion from Rs 28.9 billion in the same period a year ago.

The bank’s board declared a dividend of Rs 1.5 per equity share. The board, however, stayed mum on the controversy surrounding its chief executive officer Chanda Kochhar on allegations of conflict of interest with respect to loans made to the Videocon Group.

While provisions jumped exponentially in the quarter, it is viewed as a positive sign for the bank because while it may cause short-term pain, it helps with the recognition and accounting of bad loans plaguing the banking sector.

The result announcement led to a surge in ICICI bank’s share price, its biggest gain seen since October 2017.

At the time of writing, ICICI Bank share price was trading up by 8%.

NPAs Set to Rise Further with New RBI Rules

The Reserve Bank of India (RBI) tightened the bad debt resolution framework by scrapping numerous loan restructuring programs. This includes the likes of strategic debt restructuring scheme (SDR), Joint Lenders’ Forum (JLF), Corporate Debt Restructuring Scheme, and Scheme for Sustainable Structuring of Stressed Assets (S4A) that’s prevalent among banks to restructure defaulted loans. The RBI replaced all these schemes by the Insolvency & Bankruptcy Code (IBC).