OBC, Dena Bank slide on reports of misappropriation of funds

Shares of Oriental Bank of Commerce and Dena Bank plunged 3.54% to 4.74% at 14:53 IST on BSE on reports that Mumbai-based branches of Oriental Bank of Commerce and Dena Bank had misappropriated funds to the tune of Rs 436 crore.

Dena Bank (down 4.74% at Rs 60.30) and Oriental Bank of Commerce (down 3.54% at Rs 264.25) edged lower.

Meanwhile, the S&P BSE Sensex was down 81.46 points or 0.31% at 26,339.21.

Dena Bank's had underperformed the market over the past one month till 19 August 2014, sliding 15.43% compared with Sensex's 3.04% rise. The scrip had also underperformed the market in past one quarter, declining 19.41% as against Sensex's 8.45% rise.

Oriental Bank of Commerce (OBC) had underperformed the market over the past one month till 19 August 2014, sliding 4.7% compared with Sensex's 3.04% rise. The scrip had also underperformed the market in past one quarter, declining 14.46% as against Sensex's 8.45% rise.

According to reports, the finance ministry has unearthed misappropriation of funds to the tune of Rs 436 crore by Mumbai-based branches of Oriental Bank of Commerce (OBC) and Dena Bank. Reports said that some bank managers using middlemen issued fake fixed deposits and then used them to grant loans. As per the report, the finance ministry has ordered a forensic audit and has referred the case involving OBC to the Central Bureau of Investigation (CBI).

OBC's net profit rose 3.2% to Rs 364.54 crore on 6.1% growth in total income to Rs 5576.02 crore in Q1 June 2014 over Q1 June 2013.

The Government of India holds 59.13% stake in OBC (as per the shareholding patterns as on 30 June 2014).

Dena Bank's net profit declined 56.9% to Rs 81.52 crore on 2.1% growth in total income to Rs 2824.58 crore in Q1 June 2014 over Q1 June 2013.

The Government of India holds 58.01% stake in Dena Bank (as per the shareholding pattern as on 30 June 2014).

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