City Union Bank gained 5.99% to Rs 83.20 at 13:28 IST on BSE after the Reserve Bank of India lifted curb on foreign portfolio investors to buy shares in the bank as foreign shareholding is under prescribed limit.
Meanwhile, the BSE Sensex was down 33.50 points, or 0.13%, to 26,434.86
On BSE, so far 1.24 lakh shares were traded in the counter, compared with an average volume of 1.66 lakh shares in the past one quarter.
The stock hit a high of Rs 83.70 and a low of Rs 80.50 so far during the day. The stock had scaled a record high of Rs 87.45 on 12 September 2014. The stock hit a 52-week low of Rs 41.65 on 7 October 2013.
The stock had underperformed the market over the past one month till 25 September 2014, remaining unchanged compared with 0.12% rise in the Sensex. The scrip, however, outperformed the market in past one quarter, rising 5.3% as against Sensex's 4.56% rise.
The mid-cap private sector bank has an equity capital of Rs 59.49 crore. Face value per share is Re 1.
The Reserve Bank of India (RBI) on Thursday, 25 September 2014, notified that the foreign shareholding by foreign institutional investors (FIIs)/ registered foreign portfolio investors (FPIs) in City Union Bank has gone below the revised threshold limit stipulated under the extant FDI Policy. Hence, the restrictions placed on the purchase of shares of the bank on 18 July 2014 are withdrawn with immediate effect, the RBI said.
The Reserve Bank further notified that the City Union Bank has passed a resolution at its board of directors' meeting and a resolution in its Annual General Meeting agreeing for the purchase of its equity shares by FIIs/RFPIs/QFIs up to 40% (revised from earlier limit of 35%) of their paid-up capital through primary/secondary markets in India.
The Reserve Bank has further advised that the approval to the City Union Bank for raising FIIs/RFPIs/QFIs investment limit to 40% is subject to the condition that aggregate foreign investment in the bank should also not exceed the composite sectoral cap of 74% (49% under Automatic Route (including indirect foreign investment) & beyond 49% to 74% under Government Route) as prescribed by the Government from time to time.
City Union Bank reported 10.2% rise in net profit to Rs 99.49 crore on 7.3% rise in total income to Rs 754.03 crore in Q1 June 2014 over Q1 June 2013.
City Union Bank is a private sector bank.
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