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Bandhan Bank plummets as cyclone Amphan impacts business

Business Finance

Capital Market 

Bandhan Bank dropped 5.95% to Rs 198.20 after the bank said that that the business of around 65,000 of micro banking borrowers, amounting to exposure of approximately Rs 260 crore, could be impacted due to the Amphan cyclone.

Cyclone Amphan struck five districts in southern West Bengal and northern coastal Odisha starting in the afternoon of 20 May and lasting till the wee hours of the morning of 21 May.

As per the initial assessment, 49 banking units (micro banking outlets) in five districts were impacted, of which 45 have resumed operations today, Bandhan Bank said in a filing. It further informed that the bank will not be able to continue services in five branches due to issues in accessibility.

Bandhan Bank said that the banking outlets which had received prior warning of the Amphan cyclone were prepared with the necessary safety and business continuity measures which enabled the continuity of operations.

Bandhan Bank has relatively higher exposure to West Bengal. "In our experience of Fani, the cyclone that caused large scale damage in Odisha in May 2019, the impacted portfolio took 3 to 6 months to achieve normalcy, aided by the committed workforce and customer loyalty. On the back of this experience, we expect the Amphan affected portfolio to regularise by Q3 of FY21," the bank added.

Meanwhile, banks stocks were under pressure on Friday after the Reserve Bank of India (RBI) Governor Shaktikanta Das cut the repo rate by 40 basis points to 4% and extended moratorium on all term loans by another 3 months. The loan moratorium has now been extended till 31 August. This makes it a total of six months moratorium on loan EMIs starting from 1 March 2020.

Bandhan Bank on Tuesday, 12 May 2020, said that its net profit fell 20.52% to Rs 517.28 crore on 50.72% increase in total income to Rs 3,346.47 crore in Q4 March 2020 over Q4 March 2019.

Bandhan Bank operates as a commercial bank. The bank provides accounts checking, savings deposits, money market, mortgage, and term loans services, as well as card facilities and internet banking services. As at 31 March 2020, the total number of branches, 'Door Step Service Centers' (DSCs), GRUH Centers and ATM network stood at 1018, 3346, 195 and 485 respectively.

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, May 22 2020. 12:20 IST