HDFC Bank on Saturday reported a decent set of numbers for the quarter ended June. However Geosphere Capital's Arvind Sanger has cautioned that the performance should not be extrapolated for the rest of the banking sector.

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"HDFC Bank clearly is going to come through this crisis with the less stress, although obviously not unscathed," Sanger told CNBC-TV18.

"But we can say that the rest of the banking sector will see more severe stresses and I suspect this is going to play out over time," he said.

Sanger said it was good to see banks and non-banking finance companies raising additional capital.

"I think it is a prudent thing that the banking and some of the non-banking financial companies (NBFCs) have done which is raise additional capital to create buffer for whatever develops in terms of how long the economic pain from the COVID-19 is felt. Right now neither HDFC Bank nor any of the other banks have a clear-enough crystal ball to say whether this is economic damage for the businesses and therefore whatever comes out from the bad loans that emerge, will that last over three-six months or 12-months longer as we emerge through this COVID-19 crisis," he said.

First Published:Jul 20, 2020 10:21 AM IST