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Last Updated : Aug 07, 2019 12:43 PM IST | Source: Moneycontrol.com

J&K Bank locked at upper circuit as Centre mulls takeover options

Currently, the state government holds a 60 percent stake in Jammu & Kashmir Bank. Until recently, it had similar powers as the Reserve Bank of India (RBI) within Jammu and Kashmir.

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Shares of Jammu & Kashmir Bank were locked at 20 percent upper circuit on August 7, a day after reports said that the government was looking to strengthen the Srinagar-based lender.

The state government holds 60 percent stake in the bank, which has similar powers as the Reserve Bank of India (RBI) within in the border state.

With Parliament on August 6 agreeing to scrapping of Article 370 and splitting the state into two union territories of Jammu and Kashmir and Ladakh, things are bound to change for the bank as well.

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A union territory is directly under the control the Centre, which will also take charge of the bank. It can appoint a CEO and the board of directors as well.

A merger is one of the options being considered by the government, a report said. “The option to merge is there, but why merge it immediately? The government will explore all options,” sources said.

The bank has been in the news recently over alleged charges of corruption and nepotism . Pervez Ahmed Negroo was removed as the bank's chairman following allegations of irregularities during his tenure.

The Anti-Corruption Bureau recently sent a notice to former J&K chief minister Mehbooba Mufti, seeking clarification on certain appointments made during her term.

At 1219 hrs, Jammu & Kashmir Bank was quoting Rs 45, up Rs 7.50, or 20 percent, on the BSE.

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First Published on Aug 7, 2019 12:43 pm
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