UK-based lender HSBC on Thursday sold about 4.6 per cent stake each in Axis Bank and YES Bank for Rs 1,880 crore and Rs 550 crore, respectively, through secondary market deals.
According to National Stock Exchange data, HSBC sold 16.8 million shares in YES Bank at Rs 328.65 a share and about 19.6 million shares in Axis Bank at Rs 971.12 a share. Axis Bank shares closed at Rs 972.3, down 2.9 per cent, while those of YES Bank closed at Rs 332, down 0.8 per cent on the Bombay Stock Exchange.
According to sources, about 60 per cent of the YES Bank shares were bought by foreign investors, mostly long-only funds, while the rest were lapped up by domestic institutional investors, including Reliance Mutual Fund, SBI Life, ICICI Prudential and Birla Mutual Fund. The investors in Axis Bank couldn’t be immediately ascertained.
Shares of both the banks were sold at prices higher than the price bands provided in the term sheets, owing to good demand.
In May, HSBC had said as part of a three-year recovery plan, it had sold 28 businesses, taken 15,000 staff off its payroll and released about $55 billion in risk-weighted assets. The share sale in the Indian lenders is part of the bank’s strategy to trim its business and build reserves to tackle the tough regulations that followed the financial crisis.
This year, several foreign institutional investors have cashed their holdings in Indian financial services firms. In June, Citigroup had sold its entire holding in HDFC, India’s largest mortgage company, for $1.9 billion (about Rs 9,550 crore then). Private equity firms like Carlyle, Warburg Pincus and Singapore’s sovereign fund Temasek Holdings also hold large chunks of their holdings in Indian banks.
