Synopsis: Shares of Bandhan Bank surged 9% following the RBI's approval of Partha Sengupta as the new MD & CEO, with his tenure starting no later than November 10, 2024. Sengupta's appointment, along with the completion of a forensic audit related to insurance claims, provided a boost to investor confidence. The bank also announced that 85% of its insured portfolio under the CGFMU scheme has been repaid.
Shares of Kolkata-based Bandhan Bank soared by 9%, closing at a day's high of Rs. 204.90 after the Reserve Bank of India (RBI) approved Partha Sengupta’s appointment as the bank’s new Managing Director (MD) and Chief Executive Officer (CEO).
His appointment is set to commence no later than November 10, 2024, and will last for a period of three years.
In a regulatory filing, Bandhan Bank revealed that Sengupta’s appointment was recommended by the Board of Directors, and the RBI granted its approval through a letter dated October 8, 2024.
The bank received Sengupta’s formal acceptance on October 9, followed by his confirmation on October 10 that he will step down from his other commitments in line with the RBI’s approval conditions.
Sengupta, a seasoned banker, has extensive experience in the banking sector, having served in key leadership roles at the State Bank of India (SBI) and Indian Overseas Bank (IOB).
His appointment is viewed as a significant development for Bandhan Bank, which has been strengthening its leadership team following the extension of interim CEO Ratan Kumar Kesh’s term until November 10, 2024.
In addition to the leadership news, Bandhan Bank also provided an update on the completion of its forensic audit related to insurance claims under the Credit Guarantee Fund for Micro Units (CGFMU) and the Emergency Credit Line Guarantee Scheme (ECLGS).
The audit, conducted by the National Credit Guarantee Trustee Company (NCGTC), has now been finalized.
The bank disclosed that approximately 85% of its insured portfolio, worth Rs. 20,807 crore under the CGFMU scheme, has been repaid by customers.
The remaining non-performing portfolio has been fully provided for and written off as of March 31, 2024.
Bandhan Bank has already claimed and received Rs. 916.61 crore from the NCGTC in December 2022.
The market's positive reaction to these developments underscores the growing confidence in Bandhan Bank’s leadership transition and its progress in managing its loan portfolio and insurance claims.
In conclusion, Bandhan Bank’s 9% surge in share value reflects the market’s optimism regarding the appointment of Partha Sengupta as the bank's new MD & CEO.
His extensive experience, coupled with the bank’s completion of the forensic audit and repayment success under the CGFMU scheme, positions Bandhan Bank on a path toward continued stability and growth.
Investors are likely to monitor Sengupta’s leadership closely as he steers the bank in the coming years.
Disclaimer: This article is for informational purposes only and should not be considered financial advice. Investors are encouraged to conduct their own research or consult with a financial advisor before making investment decisions.
