{"id":131984,"date":"2023-03-28T08:37:21","date_gmt":"2023-03-28T08:37:21","guid":{"rendered":"https:\/\/fin2me.com\/?p=131984"},"modified":"2023-03-28T08:37:21","modified_gmt":"2023-03-28T08:37:21","slug":"us-banking-turmoil-adrs-of-domestic-banks-impacted","status":"publish","type":"post","link":"https:\/\/fin2me.com\/business\/us-banking-turmoil-adrs-of-domestic-banks-impacted\/","title":{"rendered":"US banking turmoil: ADRs of Domestic Banks Impacted"},"content":{"rendered":"
Analysts say domestic banks’ dependence on local depositors insulates them from the crisis.<\/strong><\/p>\n The US banking turmoil has impacted the prices of American Depository Receipts (ADRs) for domestic banks.<\/p>\n In the case of HDFC Bank, the ADR premium has shrunk by nearly 5 percentage points, from 16.5 per cent during the start of the month to less than 12 per cent, at present.<\/p>\n Meanwhile, the discount in case of Axis Bank, State Bank of India (SBI) and ICICI Bank has widened.<\/p>\n For instance, ICICI Bank ADRs were available about a per cent cheaper compared to its domestically listed shares.<\/p>\n Now the discount has widened to more than 2 per cent.<\/p>\n In other words, the sell-off — triggered by the collapse of Silicon Valley Bank (SVB) — has been more severe in the US than in India.<\/p>\n Over the past one week, most banking stocks, globally, have seen selling pressure on fears of contagion and risks for mark-to-market losses to their bond portfolios amid rising rates in the US.<\/p>\n Analysts say domestic banks’ dependence on local depositors insulates them from the crisis.<\/p>\n Interestingly, in the global banks’ market capitalisation ranking, the position of domestic banks has climbed.<\/p>\n For instance, SBI is now the 26th most valuable lender globally, up from 30th during the start of the month.<\/p>\n The ranking for HDFC Bank, India’s most valuable bank, however, has remained unchanged at 13.<\/p>\n <\/p>\n