The Hindu Business Line : Bank stocks up on move to revive UWB

Bank stocks rallied on Monday on interest shown by ICICI Bank, Canara Bank, Andhra Bank, Federal Bank and others to run and operate United Western Bank (UWB), placed under a moratorium.

The BSE Bankex index closed at 5,444.60 points, up by 1.13 per cent. The stocks of ICICI Bank (up by 1.91 per cent at Rs 620.75), Canara Bank (up by 3.47 per cent at Rs 235.30) and Federal Bank (up by 5.30 per cent at Rs 208.70) gained, while Andhra Bank declined by 0.23 per cent at Rs 88 on the BSE.

"The strong network of UWB in Maharashtra, with a deposit base of Rs 6,000 crore has led to the interest shown by various banks. Bank stocks moved up on the back of these positives," said a market dealer.

According to a banking analyst, banks such as Federal Bank will get a ready-made network in the State through the amalgamation.

However, others were unsure over the factors pushing up bank scrips as it was too early to comment.

"The impact will be felt once the RBI formally makes the announcement," said a banking analyst.

"Bank stocks have been up since last Thursday and the upward rally is not due to the expression of interest," said Mr Bhavesh Vakharia, Head-Retail Dealing, Parag Parikh Financial Advisory Services Ltd.

Earlier in the day, Mr Kirit Somaiya, President, Investors' Grievances Forum, said: "Only six months back, the bank was found healthy. Even the rights issue was allowed.

"The Finance Ministry also did not object. The Government of Maharashtra — SICOM subscribed to the rights issue at the rate of Rs 24."

The forum will meet the Finance Ministry officials tomorrow to discuss the issue, said Mr Somaiya.

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