Shares of Bandhan Bank
rose as much as 5 per cent to Rs 423 on the BSE on Wednesday in intra-day trade after the Reserve Bank of India (RBI) lifted restrictions placed on the bank from opening new branches.
".. though the Bank is still not in compliance with the licensing condition on dilution, considering the efforts made by the Bank to comply with the said licensing condition, it (the RBI) has lifted the regulatory restriction on branch opening, subject to the condition that the Bank ensures that atleast 25 per cent of the total number of 'Banking Outlets' opened during a financial year are opened in unbanked rural centres," Bandhan Bank
said in a regulatory filing.
The central bank had barred Bandhan Bank
in September 2018 from expanding its network as the lender had failed to reduce promoter stake to 40 per cent from close to 82 per cent within the stipulated three years from the time of commencing operations. Bandhan Bank had commenced operations on August 23, 2015. At present, promoters' holding in the bank is 62 per cent.
According to RBI's bank licence norms, a private sector bank's promoter needs to pare holding to 40 per cent within three years, to 20 per cent within 10 years, and to 15 per cent within 15 years.
Bandhan Bank currently has 4,288 banking outlets, including branches.
In the past four months, Bandhan Bank has underperformed the market by falling 32 per cent against 3 per cent rise in the S&P BSE Sensex
till Tuesday. The stock hit 52-week low of Rs 402 yesterday
At 9:47 AM, the stock was trading 1.52 per cent higher at Rs 410 as compared to 0.7 per cent decline in the benchmark S&P BSE Sensex.
A total of 26.4 lakh shares have changed hands on the NSE and BSE combined so far.