Stocks of government-owned banks flared up on the bourses on Friday, with most of them scaling life-time highs in intra-day trades. As many as 12 bank stocks touched new all-time highs on the Bombay Stock Exchange.

Allahabad Bank (Rs 38.95), Andhra Bank (Rs 70.10), Bank of India (Rs 80.60), Canara Bank (Rs 183.70), Punjab National Bank (Rs 384.85), State Bank of Bikaner and Jaipur (Rs 2,154), Syndicate Bank (Rs 55.15), Union Bank of India (Rs 83.50) and UCO Bank (Rs 28.90) make up the nine scrips to have closed at all time highs, propelling the BSE bank stock index Bankex 2.45 per cent to a historic high of 3,296.23 at close.

Meanwhile, Corporation Bank, Federal Bank, and J&K Bank touched all time highs in intra-day trades on the BSE. Dena Bank and IndusInd Bank touched new 52-week highs while the State Bank of India, ICICI Bank and HDFC Bank scrips are currently traded near their lifetime highs.

Most bank stocks have gained ground on expectations of good quarterly performance. The three banks which have declared results so far have reported more than 90 per cent growth in net profit.

At close, Punjab National Bank was 7.28 per cent higher at Rs 384.85, off a historic high of Rs 392.80 in intra-day trades. Private sector giant ICICI Bank was second largest gainer, closing 6.90 per cent higher at Rs 319.15.  Foreign institution investors are also seen to be more active in banking stocks in recent months.

During the quarter ended March 2004, FII holding in ten banks including J&K Bank, Canara Bank, Corporation Bank and Union Bank of India increased by more than one percentage point.

During the last one month, the total market capitalisation of banking stocks has increased 27 per cent [Rs 31,335 crore (Rs 313.35 billion)] to Rs 1,46,817 crore (Rs 1,468.17 billion).

The sector index Bankex has outperformed the Sensex by posting a 22 per cent gain in the last one month against just a 9 per cent appreciation in the Sensex.