HDFC sells 3% stake in Bandhan Bank via bulk deals

Bandhan Bank

Housing Development Finance Corp (HDFC) has sold a 3% stake or nearly 50 crore shares of Bandhan Bank via bulk deals, people in the know told Moneycontrol. As of December end, the mortgage giant held a 9.9% stake in Bandhan Bank.

“HDFC held around 10% stake in Bandhan Bank. Sometime back one and a half percent approximately was sold and today 3.5%, so now they are just below 5%,” one person quoted above said.

“This is to basically comply with RBI regulations. Henceforth, the understanding is that there will be no more sale of Bandhan Bank shares,” one of the persons quoted above said.

Today, shares of HDFC ended 0.2% lower at Rs 2,457.35 apiece on the National Stock Exchange, while those of Bandhan Bank ended 2.9% higher at Rs 325 per share.

In a surprise move on April 4, the HDFC twins announced the merger between HDFC and HDFC Bank. On completion of the deal, HDFC will acquire a 41 percent stake in HDFC Bank and all subsidiaries of the housing financier will be owned by the lender.

HDFC Chairman Deepak Parekh said the rationale behind the merger included several aspects like less onerous statutory liquidity requirement and cash reserve ratio (SLR and CCR requirements), a favourable interest rate regime, and increased transparency in the realty sector, and giving mortgage customers access to a wider range of services.

Parekh said HDFC Bank in its proposal has asked the RBI to adopt a phased approach to meet SLR and CRR requirements after its merger with HDFC. Further, HDFC Bank also requested the RBI to allow it to “grandfather” certain assets and liabilities of HDFC. Grandfathering is essentially an exemption from a new regulation that may be introduced for a particular sector.

In a post monetary policy committee meeting press conference on April 8, RBI Governor Shaktikanta Das said the regulator has received a proposal from HDFC and HDFC Bank on the merger deal and it is being examined.

“We have received a proposal from HDFC and HDFC Bank with regard to the merger announcement they have made,” Das said. “The proposal has been received and is under examination and we will, in terms of our various regulatory guidelines and other aspects, examine them and as and when a decision is taken, you will come to know about it,” the governor added.