Bandhan Bank shares crash 20% as RBI bars co from opening new branches

Shares of Bandhan Bank crashed 20 per cent Monday as the Reserve Bank restrained the company from opening new branches and also ordered freezing of remuneration of its CEO Chandra Shekhar Ghosh for not meeting the licensing conditions. The stock after a weak opening further tumbled 20 per cent to Rs 451.20 its 52-week low -- on BSE.

At NSE, shares of the company tanked 20 per cent to hit one-year low of Rs 452.20,  The stock also touched the lower circuit on both exchanges. The bank, on its part, said it is taking steps to comply with licensing condition to bring down the shareholding of Non Operative Financial Holding Company (NOFHC) in the bank to 40 per cent.

"RBI has communicated to us that since the bank was not able to bring down the shareholding of NOFHC to 40 per cent...General permission to open new branches stands withdrawn and the bank can open branches with prior approval of RBI and the remuneration of the MD & CEO of the Bank stands frozen at the existing level, till further notice," it said in filing to stock exchanges Friday.

It is taking steps to comply with licensing condition to bring down the shareholding of NOFHC to 40 percent and will continue to engage with the RBI, Bandhan Bank said.