At around 1.11 pm, Nifty Bank was trading at 31,384.20 down 802.70 points or 2.49%. The index has touched an intraday low of 31,308.15.
Nifty PSU Bank fell by 2.53% at 1,867.50 and Nifty Private Bank slumped by 2.6% at 17,164.35.
Bandhan Bank was the worst hit, slipping by nearly 8% after net profit falls by 13.4% to Rs633cr in Q3FY21 against Rs731cr a year ago same period. The lender's gross NPA improved to 1.1% as against 1.9% three months back.
Investors concern arises due to non-performing assets (NPA) that are not classified during loan moratorium period amid Covid-19 pandemic. Bankers who have announced their Q3 result have already informed that gross NPA would have been higher if accounts were classified after August 2020 period.
Furthermore, on the index, RBL Bank followed Bandhan to dive by 7%. While Bank of Baroda, Federal Bank, PNB and Axis Bank plunged between 3-4%.
Heavyweight ICICI Bank nosedived by nearly 3% followed by SBI which recorded over 2% downside.
HDFC Bank and IDFC First Bank dropped by nearly 2% each, while IndusInd Bank and Kotak Bank tanked by around 1% each.