Allahabad Bank drops after RBI places it under prompt corrective action

Allahabad Bank dropped 2.07% to Rs 70.85 at 10:39 IST on BSE after the bank said that the Reserve Bank of India has placed the bank under prompt corrective action framework consequent to the onsite inspection.

The announcement was made after market hours yesterday, 3 January 2018.

Meanwhile, the BSE Sensex was up 49.18 points, or 0.15%, to 33,842.56. The BSE Mid-Cap index was up 54.41 points, or 0.31%, to 17,873.73, outperforming the Sensex.

On the BSE, 2.4 lakh shares were traded in the counter so far, compared with an average daily volume of 2.94 lakh shares in the past one quarter. The stock had hit a high of Rs 73 and a low of Rs 70.40 so far during the day. The stock had hit a 52-week high of Rs 92.50 on 12 May 2017. The stock had hit a 52-week low of Rs 60.25 on 3 January 2017.

The mid-cap bank has an equity capital of Rs 800.21 crore. Face value per share is Rs 10.

Allahabad Bank said that the Reserve Bank of India has placed the bank under prompt corrective action framework, consequent to the onsite inspection under the risk based supervision model carried out for the year ended March 2017 and the report issued thereof.

The RBI inspection has revealed high non-performing assets and negative return on assets for the two consecutive years. The action will contribute to the overall improvement in risk management, asset quality, profitability, efficiency etc of the bank.

Allahabad Bank's net profit rose 8% to Rs 70.20 crore on 0.3% rise in total income to Rs 5067.78 crore in Q2 September 2017 over Q2 September 2016.

Government of India holds 68.32% stake in Allahabad Bank (as on 30 September 2017).

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