Syndicate Bank advances on credit rating upgrade

Syndicate Bank rose 1.63% to Rs 31.25 after the bank said that S&P Rating Agency has revised the bank's long term issuer credit rating to positive from stable.

The announcement was made after market hours yesterday, 16 September 2019.

Shares of Syndicate Bank fell 3.90% in the past three trading sessions to settle at Rs 30.75 yesterday, 16 September 2019, from its close of Rs 32 on 11 September 2019.

Syndicate Bank during market hours yesterday, 16 September 2019, said that CARE Ratings has revised the rating outlook of Tier II/ Perpetual/ Basel III Tier II/ Basel III Additional Tier I bonds to rating 'under credit watch with developing implications' in view of the Ministry of Finance's announcement regarding the proposed amalgamation of Syndicate Bank with Canara Bank.

In a press briefing on 30 August 2019, Finance Minister Nirmala Sitharaman announced that Canara bank and Syndicate Bank will be merged. The entity will be fourth largest public sector bank with business of Rs 15.20 lakh crore. The entity will have third largest branch network in India with 10,342 branches.

The scale and synergy will benefit through large cost reduction potential due to network overlaps. Similar culture will enable smooth consolidation. Cost saving and income opportunities will arise for JVs and subsidiaries.

Both the banks share a common CBS (core banking software), iFlex, which will enable quick realization of gains.

On BSE, 39,000 shares were traded in Syndicate Bank counter, compared to a 2-week average of 82,000 shares. The stock hit an intraday high of Rs 32 and an intraday low of Rs 30.85.

It hit a 52-week high of Rs 46.60 on 2 April 2019 and a 52-week low of Rs 29.10 on 23 August 2019.

On a consolidated basis, Syndicate Bank reported a net loss of Rs 957.37 crore in Q1 June 2019 compared with a net loss of Rs 1,238.33 crore in Q1 June 2018. Total income rose 7.9% to Rs 6,080.69 crore in Q1 June 2019 over Q1 June 2018.

Syndicate Bank's segments include treasury, corporate/wholesale banking, banking and other banking operations. The bank offers deposits, including current and term deposits; loans, including retail loans, agricultural loans and priority sector loan, small and medium enterprises (SME) loan and corporate finance.

Powered by Capital Market - Live News