You are here: Home » News-CM » Equities » Hot Pursuit
Business Standard

IDFC First Bank turns volatile after CEO Vaidyanathan sells 2.75 cr shares

Capital Market 

The bank informed that Vaidyanathan will further sell around Rs 35 crore worth of shares on Friday, 20 March 2020.

Shares of IDFC First Bank were up 2.66% at Rs 21.20. The stock crashed 9.93% to hit the day's low of Rs 18.6 in early trade. It bounced back and rallied 16.4% to hit a fresh intraday high of Rs 21.65 in early afternoon trade.

IDFC First Bank announced in early trade today, 20 March 2020, that it received an intimation from V. Vaidyanathan, managing director and chief executive officer of the bank that he has sold 2,75,58,412 shares on 19 March 2020 for approximately Rs 58 crore to close ESOP (employee stock ownership plan) loan availed by him.

The bank said Vaidyanathan intends to sell about Rs 35 crore worth of stocks on Friday, 20 March 2020, to entirely repay the residual ESOP loan taken for exercising his ESOP shares to release his pledged shares.

Vaidyanathan has explained that with this sale he will have 'NIL' ESOP loan, and will not need to sell any more shares in the foreseeable future. He has also explained that the bank is doing wonderfully well on all counts, is on a great trajectory of performance on all parameters, and he looks forward to continue to build the bank to great heights with highest degree of corporate governance going forward as well, the bank said in a statement.

I like to inform that I sold 2,75,58,412 shares yesterday to to close the ESOP loan availed by me to acquire the shares and I intend to sell about Rs. 35 crores worth of stocks today to entirely repay the residual ESOP Loan taken for exercising my ESOP shares and to release the pledged shares. I would like to clarify that I still hold 4,23,47,144 shares (0.88%) after yesterday's sale. The prices of the stock has come down recently due to the Coronavirus related development in the stock market across all sectors including all Banks which resulted in margin call, and at this stage I decided to sell the stock to entirely square the ESOP Loans. With the sale of Rs. 35 cores expected today, my loans against shares will be NIL. I have no other loans other than a home loan," V. Vaidyanathan said in a letter sent to the bank.

"We are building a wonderful bank with strong trajectory of growth of branches, strong growth in retail loans, sharp improvement in CASA, with low NPA and high capital adequacy. All our trajectory strongly positive across all parameters. Hence I deeply regret sale of shares at this growth stage of our bank given the wonderful prospects, but I had to do the same to square the ESOP Loan. I believe there will be no need for me to sell any more shares in the foreseeable future," he added.

He further stated in the letter that, "Under the disclosure requirements, I am required to disclose the sale done yesterday within 2 working days. However, in interest of highest level of corporate governance, I am making disclosure within 1 working day and also disclosing the intent to sell only today, and also sharing the extent of sale ahead of reporting requirements. Even after this sale I will hold approximately 13 crores stocks and options in the bank. I am entirely committed to building one of the greatest banks in the country with the highest levels of corporate governance as we have always represented."

IDFC First Bank provides a range of financial solutions to individuals, small businesses and corporates. It has a nationwide presence with 260 branches, 140 ATMs and 454 rural business correspondent centres across the country, net banking, mobile banking and 24/7 toll free Banker-on-Call service.

Powered by Capital Market - Live News

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

First Published: Fri, March 20 2020. 13:38 IST
RECOMMENDED FOR YOU
RECOMMENDED FOR YOU