($1 = 82.6530 Indian rupees) (Reporting by Aniruddha Ghosh in Bengaluru and Siddhi Nayak in Mumbai; Editing by Janane Venkatraman and Savio D'Souza)
(Updates with more comments, details)
March 16 (Reuters) - India's banking sector will likely
have a softer impact from the troubles at Credit Suisse , given the Swiss lender's relatively small presence in
the country, equity analysts at Jefferies said on Thursday.
Credit Suisse has a 1.5% share among foreign banks' assets
in India and a 'small' 0.1% share of overall banking assets in
the country, Jefferies estimated. It has only 1 branch in India
and total assets of over 200 billion rupees ($2.42 billion), it
said.
"Given the relevance of Credit Suisse to India's banking
sector, we see softer adjustments in assessment of counter-party
risks, especially in the derivative market," analysts
Prakhar Sharma and Vinayak Agarwal said in a note.
Earlier in the day, Credit Suisse said it would
borrow up to $54 billion from the Swiss central bank to shore up
liquidity and investor confidence after a slump in its shares
intensified fears about a global banking crisis.
Credit Suisse, Switzerland's second-biggest bank, is the
first major global bank to be given an emergency lifeline since
the 2008 financial crisis and its problems have raised serious
doubts over whether central banks will be able to sustain their
fight against inflation with aggressive interest rate hikes.
Those fears have roiled financial markets globally as well
as in India.
Jefferies said it would watch out for liquidity issues and
any rub-off on counter-party risk assessment on Indian banks,
especially in derivatives.
The brokerage expects the Reserve Bank of India to keep
a close watch on liquidity issues and counter-party exposures,
and intervene if necessary.
This may also lead to institutional deposits moving more
towards larger or quality banks, Jefferies said.
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