FIIs reduce holding in govt banks

Stake in private banks increases marginally.

Foreign institutional investors (FIIs) reduced their stake in public sector banks, but increased their holdings in private banks during the quarter ended December 2008.

The shareholding pattern data for the quarter ended December, 2008 indicate that the FIIs have reduced holding in 21 banks and increased it in six banks. Their shareholding in four banks remained unchanged.

The maximum sale took place in mid- and small-cap banks. Those which witnessed a 2-3 per cent decline in FII holding are Karnataka Bank, Federal Bank, Syndicate Bank, Allahabad Bank and Indian Overseas Bank.

The shareholding in large-cap pubic sector banks such as State Bank of India (SBI), Bank of Baroda, Union Bank of India, Corporation Bank and Canara Bank went down by around 1.5-2 per cent each. FIIs have increased their holding in private banks such as HDFC Bank and ICICI Bank by around 0.35 per cent each.

Citigroup Global Markets Mauritius, CLSA Mauritius, Genesis India Investment Company and Platinum Asset Management are among the FIIs which offloaded shares in SBI, Federal Bank, Canara Bank, Bank of India, Karnataka Bank, Corporation Bank and Bank of Baroda.

Citigroup Global Markets Mauritius’ holdings in Central Bank of India, Canara Bank and Federal Bank declined below one per cent in the December 2008 quarter from over one per cent each at the end of September 2008 quarter. CLSA Mauritius sold shares of SBI, Jammu and Kashmir Bank, Canara Bank and Bank of India during the quarter.

FII holding in SBI, the largest public sector bank, has declined below 11 per cent for the first time in the last eight years — from 12.04 per cent to 10.42 per cent. CLSA Mauritius, which held 2.47 per cent stake in the bank in the September quarter, has reduces its holding to below one per cent at the end of December.

Among private banks, FIIs pruned holding in Axis Bank by over two per cent. In Karnataka Bank, FII holding declined 3.45 per cent from 38.54 per cent to 35.09 per cent at the end of the December 2008 quarter. Citigroup Global Markets Mauritius reduced its holding in the bank by almost one per cent from 4.18 per cent to 3.19 per cent during the quarter.