Bandhan Bank tumbles 12% as 21% equity changes hands via block deal

The names of the buyers and sellers could not be ascertained immediately.
Shares of Bandhan Bank tumbled 12 per cent per cent to Rs 304.2 on the BSE on Monday after nearly 21 per cent of the bank's equity changed hand on the NSE and BSE via block deals. At 9:38 am, the stock was trading 8.4 per cent lower on the BSE at Rs 316 apiece, as against 280 points, or 0.74 per cent, decline in the S&P BSE Sensex. 

Approximately 337 million shares, representing 20.95 per cent equity of the bank and worth Rs 10,482 crore, changed hands on the counter at around 9:15 am on the BSE and NSE. However, till 3:21 pm, 497.37 million crore shares, of which 375.4 million were on the BSE and 121.93 million were on the NSE, had changed hands on the exchanges, data shows. The lender's total market capitalisation now stands at Rs 49,701 crore, BSE data shows. The stock eventually close 10.60 per cent lower at Rs 308.65 apiece.

"In order to be fully compliant with the Licensing Guidelines, Bandhan Financial Holding Ltd has today i.e. August 03, 2020 informed the Bank that it has diluted its excess shareholding of 20.95 per cent i.e. 33,73,67,189 equity shares of Rs. 10/-  each fully paid-up in the Bank through secondary market sale," the bank said in a regulatory filing READ FILING HERE

"Consequent to the above transaction, the shareholding of the promoter in the Bank has been reduced to 40 per cent of the total paid-up voting equity capital of the Bank," it added.

The names of the buyers could not be ascertained immediately. 

Blooomberg had reported recently that Bandhan Bank’s main shareholder Bandhan Financial Holdings was looking to sell 337.4 million shares in a block trade today, seeking to raise $1.4 billion.

"Those shares are offered at a floor price of Rs 311.1 ($4.16) each, according to the terms. Books will close by 11:30 pm in Hong Kong on Aug. 2. and trading will start on Aug. 3," the report said. READ REPORT HERE

Bandhan Bank, the report added, is exploring options to further bring down promoter's stake in the bank to the prescribed 40 peer cent of the paid-up equity capital. At th end of June quarter, Bandhan Financial Holding held 60.95 per cent stake in the lender. 

So far in the financial year 2020-21, the bank's stock price has surged 69.5 per cent on the BSE, compared with 28 per cent gain in the S&P BSE Sensex. 

In April-June quarter of FY21, the Kolkata-based lender's profit declined 32 per cent YoY to Rs 550 crore as against Rs 804 crore in the year ago period due to seven times rise in provisions and contingencies. 

During the quarter it took accelerated additional provision on standard advances amounting to Rs 750 crore to cover the Covid-19-related credit risks. Total provisions stood at Rs 849 crore as against Rs 125 crore.

Its operating profit, meanwhile, grew 17 per cent at Rs 1,584 crore against Rs 1,356 crore in the same period with net interest income growing 15 per cent at Rs 1,811 crore.

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