Federal Bank extends recent gains

Federal Bank rose 2.52% to Rs 93.45 at 9:22 IST on BSE, with the stock extending recent gains triggered by Reserve Bank of India withdrawing its restrictions placed on purchase of the bank's shares by foreign investors with immediate effect.

Meanwhile, the S&P BSE Sensex was up 173.22 points or 0.8% at 21,928.54.

On BSE, so far 2.06 lakh shares were traded in the counter as against average daily volume of 2.53 lakh shares in the past two weeks.

The stock hit a high of Rs 95.80 and a low of Rs 92.95 so far during the day.

Shares of Federal Bank have surged 8.72% in two trading sessions from Rs 85.95 on Friday, 21 March 2014 after the bank after market hours on Friday, 21 March 2014 said the Reserve Bank of India (RBI) withdrew its restrictions placed on purchase of the bank's shares by foreign investors with immediate effect. The stock had surged 6.05% to settle at Rs 91.15 on Saturday, 22 March 2014. A special live trading session was held on Saturday, 22 March 2014, as the National Stock Exchange (NSE) was testing its software.

The RBI on Friday, 21 March 2014, notified that the restrictions placed on the purchase of shares of Federal Bank have been withdrawn with immediate effect. Equity shares of Federal Bank can now be purchased through primary market and stock exchanges, the RBI said. The Reserve Bank of India stated that consequent upon the Government of India approving the increase in foreign investment in Federal Bank from 49% to 74% of its paid up equity share capital of Federal Bank, the aggregate shareholding through Foreign Institutional Investors (FIIs)/Non-Resident Indians (NRIs)/Persons of Indian Origin (PIOs)/Foreign Direct Investment (FDI)/American Depository Receipt (ADR)/Global Depository Receipts (GDRs) in Federal Bank has gone below the prescribed threshold ban limit stipulated under the extant FDI policy.

Federal Bank's net profit rose 9.2% to Rs 230.13 crore on 9.9% growth in total income to Rs 1895.92 crore in Q3 December 2013 over Q3 December 2012.

Federal Bank is a leading private sector bank in India.

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