Shares of the private sector bank hit a low of Rs 262 on April 2, 2018, falling 14% from its recent high of Rs 306 on March 14, amid controversy over the alleged conflict of interest and quid pro quo involving its CEO Chanda Kochhar and her family members in extending a loan to Videocon Group. The benchmark index dipped 1.7% during the same period.
Global Rating Agency Fitch on Monday said losses on the loan in question would be unlikely to significantly undermine ICICI's financial profile - in particular, its core capitalisation would remain strong even if the loan were completely written off. The banks' rating is underpinned by relatively strong capitalisation and profitability. Core capitalisation was 14.2% in December 2017, among the highest in the sector.
ICICI Bank extended a loan with a potential conflict of interest raises questions over the bank's governance and creates reputational risks, says Fitch Ratings.
Fitch will closely monitor developments, and would take appropriate rating action if risks to the banks' reputation and financial profile were to rise considerably, it added.
Meanwhile, Merrill Lynch on Monday bought nearly 30 million shares of ICICI Bank for Rs 8,234 million through an open market transaction.
According to the block deal data available with BSE, Merrill Lynch Markets Singapore Pte Ltd acquired 29.41 million shares, representing 0.46% stake in the bank. The shares were picked up at an average price of Rs 280, valuing the transaction at Rs 8,234 million, the data showed.
At 11:08 am; ICICI Bank was trading 2.7% higher at Rs 288 on the BSE, as compared to 0.27% rise in the S&P BSE Sensex. A combined 18.51 million shares changed hands on the counter on the NSE and BSE.