* NSE index up 0.37 pct, BSE index 0.45 pct higher
* Nifty PSU Bank Index rises as much as 0.79 pct
* Lanco Infratech hits record low on RBI insolvency order
By Jessica Kuruthukulangara
June 19 - Indian shares rose on Monday as lenders such as
State Bank of India gained after the central bank asked
banks to start banktruptcy process against 12 large loan
defaulters, raising hopes that reduction of bad debt will start
The Reserve Bank of India urged lenders to initiate
bankruptcy proceedings against a dozen companies, including
Essar Steel, Bhushan Steel Ltd and Monnet
Ispat and Energy Ltd, sources with direct knowledge of
the matter said.
The RBI said it had identified the 12 defaulters last week,
but did not publicise their names.
"There is a general feeling that non-performing asset (NPA)
levels will come down after the RBI order to resolve NPAs of the
country," said RK Gupta, managing director at Taurus Asset
The broader NSE index was up 0.37 percent at
9,623.65 as of 0644 GMT, while the benchmark BSE index
was 0.47 percent higher at 31,201.69.
The Nifty PSU Bank Index gained as much as 0.79
percent, with top lenders State Bank of India up as
much as 0.7 percent and Canara Bank Ltd rising as much
as 1.8 percent.
Loan defaulters that are facing bankruptcy proceedings
Lanco Infratech Ltd was down as much as 8.5
percent to 2.15 rupees, a record low, after it said it was one
of the companies that had been identified by the RBI to start
Shares of Monnet Ispat and Energy Ltd fell as much
as 19.9 percent.
The Nifty Pharma Index was down as much as 1.08
percent as ongoing quality concerns raised by the U.S. Food and
Drug Administration pressured pharma stocks.
Cipla Ltd, the biggest drag on the pharma index,
was down 2 percent.
(Reporting by Jessica Kuruthukulangara in Bengaluru; Editing by