Keeping its losing streak for the third straight session on Friday, March 13, State Bank of India (SBI), the country’s largest bank, dropped another 3% to the day’s low of ₹1,052.60 apiece as investor concerns grew that rising bond yields could put pressure on banks’ treasury portfolios, given that state-owned banks maintain large holdings of government securities.
Today’s fall has not only pushed the stock to a four-week low but has also brought the company’s market capitalisation below ₹10 lakh crore. The 3% drop in the stock has eroded about ₹30,090 crore from the bank’s market value, bringing it down to ₹9,71,549 crore.
Taking the previous close of ₹1,085.20 per share into account, the market capitalisation of SBI stood at ₹10,01,639 crore. At its peak, the market capitalisation of the public sector lender stood at ₹11,39,628 crore.
The fall has not only impacted the bank’s shareholders’ wealth but has also significantly weighed on Life Insurance Corporation of India’s shareholding, as the country’s largest insurer and asset manager owns a 9.23% stake in SBI, making it the single largest institutional shareholder.
Though rising bond yields may have a limited impact on banks’ net interest margins, they could affect treasury performance. Higher yields typically translate into mark-to-market pressure on available-for-sale and trading portfolios, creating volatility in treasury income.
This becomes more relevant in an environment where yields are expected to drift higher amid elevated government borrowing and a reduced likelihood of policy rate cuts.
India’s benchmark 10-year government bond yield has risen to around 6.67% in today’s session, after touching 6.76% earlier this week.
The rising yields indicate that the Street expects higher crude prices to stay longer—driven by the ongoing conflict involving the United States and Iran—to feed into inflationary pressures, which could delay further monetary easing.
The Reserve Bank of India has intervened in the secondary market, buying bonds to help cap the rise in yields.
Meanwhile, tensions in West Asia have also pushed the Indian rupee to multiple record lows against the US dollar, reflecting continued market sensitivity to oil shocks and geopolitical risks.
SBI share price trend
Amid sustained selling pressure, SBI shares have lost about 12% of their value in March so far, marking the biggest monthly drop since March 2020, when the stock plunged 35%. However, the decline appears relatively modest when compared with the gains accumulated in recent months.
Between March 2025 and February 2026, the stock witnessed an almost one-way rally, closing 11 out of 12 months in the green, delivering a massive 75% return and emerging as one of the top performers among PSU banks.
The rally also pushed the bank’s market capitalisation above ₹11 lakh crore, making it the second most valuable listed bank on the Indian stock market.
Disclaimer: We advise investors to check with certified experts before making any investment decisions.
