We prefer the private sector banks: BNP Paribas Investment Partners

In a chat with ET Now, Simon Godfrey, Investment Specialist-Emerging Markets, BNP Paribas Investment Partners, talks about PSU and private banks.

ET Now: What are your thoughts on banks and there is a clear distinction in India that those who like value, they like PSU banks and those who like quality, they like private banks?

Simon Godfrey: Our view on this is quite well rehearsed. We definitely prefer the private sector banks. We think they have better growth prospects especially now that they are trying to grow out of the urban areas and may be expanding to more rural or semi urban areas. We think they are much better managed with a wider range of revenue streams. So we continue to hold that view. We prefer the private sector banks and the public sector banks could be more interest-rates sensitives, but we are wary of the asset quality there. So we do not think that even in a sharp easing cycle, the reward outweighs the risk there.