EMI Moratorium case in SC: Anil Singhvi on possible outcome and its impact on stock market

The Supreme Court is hearing the crucial petition on EMI Moratorium today and the entire banking sector, loan takers and stock market investors are looking at the apex court with their fingers crossed.

The reason is that any negative ruling against the banks may lead to a whopping Rs 2 lakh crore loss to them.

The Supreme Court is hearing the crucial petition on EMI Moratorium today and the entire banking sector, loan takers and stock market investors are looking at the apex court with their fingers crossed. The reason is that any negative ruling against the banks may lead to a whopping Rs 2 lakh crore loss to them. Zee Business Managing Editor Anil Singhvi said that there are some possible outcomes like court ruling against banks asking lenders to decide on the interest waiver too. However, it may go against those loan borrowers who are paying their EMIs on time even in this crisis. So, Anil Singhvi said that Supreme Court might change its stance and ask banks to decide on the same as it is only a suggesting authority.

Speaking on the possibility of highest court ruling against banks and directing them to give interest waiver to borrowers too, Anil Singhvi said, "The Supreme Court has earlier indicted that EMI waiver means interest waiver too. If it continues with its stance and the reply given by RBI and various banks fail to satisfy it, then the entire banking sector will have to incur around Rs 2 lakh crore loss." Singhvi said that such a ruling will have negative impact on the stock market, especially Bank Nifty.

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Anil Singhvi added, "RBI and banks must have talked about the bank culture in their reply. They would have mentioned about those who didn't avail of waiver and are continuing to pay their EMI on time. Such loan borrowers might feel disheartened if the interest rate waiver is also given in the EMI moratorium. In fact, such borrowers deserve reward instead of such disheartening outcome."
Singhvi said that in such a scenario, the Supreme Court may ask RBI and banks to take a decision in this regard by asking them to give some more relief in the EMI moratorium offer. If that happens, then we can witness some relief rally in the Bank Nifty index, said Singhvi.

See Zee Business tweet below:

सुप्रीम कोर्ट में लोन मोरेटोरियम पर फैसला आज...अनिल सिंघवी ने कहा- बाजार के लिहाज से ये फैसला अहम...फैसला ब्याज माफी पर आया तो मार्केट सेंटिमेंट होगा खराब#EditorsTake #SupremeCourt #Moratorium #RBI @AnilSinghvi_ pic.twitter.com/0PJXsESMqm

— Zee Business (@ZeeBusiness) June 12, 2020

Anil Singhvi concluded by saying, "Market has this later outcome in the back of the mind as it has scaled to the 21,800 level even after Supreme Court made its stance clear in its earlier hearing."

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