RBI Crackdown on Rupee Speculation Sinks Bank Stocks Up to 4%

• Bank stocks dropped up to 4% on April 2 after RBI intensified its crackdown on rupee speculation, targeting corporate arbitrage.
• The Nifty Bank index slid 2.8%, with private lenders losing 2.1% and state-owned banks 3.2%.
• AU Small Finance Bank, Bank of Baroda, and Federal Bank shares were down 4%, 3.9%, and 3.8% respectively.
• New rules, effective immediately, cap lenders’ daily onshore currency positions at $100 million, leading to unwinding of $4-10 billion in arbitrage trades.
• Jefferies analysts estimate fresh curbs could lead to losses of Rs 4,000 crore-Rs 5,000 crore for banks.