Bandhan Bank gets SEBI exemption for share-sale

Our Bureaus Mumbai/Kolkata | Updated on October 15, 2018 Published on October 12, 2018

Earlier, the RBI had pulled up the bank for its failure to bring down promoter holding

SEBI has exempted Bandhan Bank from restrictions placed on share sale by its promoters. SEBI stipulates a one-year lock-in on the sale of equity shares by promoters in a newly-listed company. Earlier, the RBI had pulled up Bandhan Bank for its failure to bring down the promoter holding to 40 per cent as mandated in the licensing norms for universal banks. The central bank has withdrawn permission to Bandhan Bank to open new branches and has put a freeze on the remuneration of its MD & CEO, CS Ghosh.

SEBI’s exemption would help the bank comply with the RBI’s licensing norms. Promoter holding in the bank stood at 82.28 per cent.

“In continuation to our intimation dated September 28, 2018, it is hereby informed that we have received an exemption from SEBI with respect to lock-in of one year on the equity shares held by the promoter and eligibility condition of one year from listing in order to comply with the requirements of RBI licensing guidelines,” the bank said in a communication to stock exchanges on Friday.

Bandhan Bank turned into a bank in August 2015, from its earlier avatar as a microfinance institution. So, ideally, it should have scaled down the promoter’s holding by August 2018.

“With this exemption the bank will have the additional option of exploring secondary share issue and they can go for it earlier than March 2019,” said an analyst on condition of anonymity.

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Published on October 12, 2018
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