J&K Bank tanks 20% after govt sacks chairman on corruption charges

Shares of Jammu & Kashmir (J&K) Bank tanked 20 per cent to Rs 47.60 apiece on the BSE on Monday after reports suggested that the Anti-Corruption Bureau (ACB) alleged Parvez Ahmed, now-removed chairman-cum-managing director, of indulging in unlawful activities.

The searches on the premises of the J&K Bank, which started on Saturday after an FIR was lodged by the ACB, concluded on Sunday and revealed involvement of Ahmed in corruption, nepotism and favouritism. CLICK HERE TO READ FULL REPORT.

Soon after, the state government removed Ahmed from the post of chairman-cum-managing director of the bank. RK Chhibber has been appointed as the interim chairman-cum-managing director with effect from June 8, 2019, J&K Bank said in a regulatory filing.

The Jammu and Kashmir government holds 59 per cent stake in the J&K Bank.

The action against the J&K Bank chairman and investigation into alleged backdoor appointments, “irregularities, loot and plunder” is intended to cleanse the system, news agency PTI reported, quoting a government official. 

At 09:17 am, the stock of J&K Bank was trading 19 per cent lower at Rs 47.95 per share on the BSE, as compared to a 0.74 per cent rise in the benchmark S&P BSE Sensex. The trading volumes on the counter nearly doubled in first five minutes of trading with a combined 8,31,066 shares changed hands on the NSE and BSE so far.