Srinagar: Jammu and Kashmir Bank chairman here today said that the financial crisis engulfing the global markets may last for another year and a half as there are no signs of recovery in the near future.

"In my opinion, the crisis will last longer than expected as there are no indications or cues for the markets to move up soon," Drabu, who is also economic advisor to the state government told PTI.

"We are in the middle of a global financial crisis. Markets across the world have tanked on strengthening of recession fears .... We are apparently now in the second stage of the crisis," Drabu said.

On the crash of the sensex today, he said that it was due to liquidity pressures created by reduced investment inflow.

"The crash is not related to the company position -- how good or bad it is doing -- but to the liquidity pressures," he added.

He said the announcement of the RBI policy also led to the stock market falling sharply in today s trade as there was an expectation that the bank will cut the repo rates.

"The repo rates have not been cut as was expected .... There were expectations that the RBI will announce a cut in credit reserve ratio (CRR) and even statutory liquidity ratio (SLR)," the JK Bank chairman said.

However, Drabu was optimistic about a bounce back of the markets saying it was good time for institutional investors to buy.

"It is a good time to buy with long term goals. Valuation at the moment is extremely cheap.... There are hundreds of companies trading below book value," he added.
Source : PTI