Nifty hits to a month-low, Banking stocks Drag

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The NSE Nifty fell for a fifth straight session and touched a one-month low on Tuesday as lenders took a hit following a report that the country's central bank has demanded higher provisioning for loans submitted under the insolvency process.

The Reserve bank of India has asked banks to set aside at least 50 percent of the loan amount for accounts referred to bankruptcy courts. The move could hurt bank's earnings to the tune of 500 billion rupees, it reported.

"PSU banks will be under pressure foe some more time as improvement in earnings for these banks will get delayed due to higher provisioning requirement," said Siddharth Purohit, senior research analyst at Angel Broking.

The broader NSE Nifty was down 0.75 percent or 82 points at 9,493 as of 2.51 pm while the benchmark BSE index was 0.75 percent or 236 points lower at 31,041.95.

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