Key Points
- Bandhan Bank shares jumped over 10% after RBI approved Partha Sengupta as CEO.
- Sengupta takes over from Chandra Shekhar Ghosh, who retired in July.
- The recent loan claims audit ended on a positive note.
- Asset quality is slipping, with more non-performing assets showing up.
- Analysts believe the new CEO will help stabilize things for the bank.
Looma News
Bandhan Bank Shares shot up over 10% on Friday after the Reserve Bank of India said yes to Partha Pratim Sengupta becoming the new CEO. This change is seen as a much-needed stability boost for the bank, especially after some rocky leadership times. Sengupta knows his stuff; he’s got solid experience from the State Bank of India and was the CEO at Indian Overseas Bank from 2020 to 2022. His background should really help Bandhan.
During mid-morning trading, Bandhan’s stock hit ₹207.45, a cool 10.52% increase. Analyst Suresh Ganapathy from Macquarie mentioned that having an experienced PSU banker in charge can really help settle things down, especially since the bank has seen a few exits lately.
Positive Audit Results
In other news, the bank just finished an audit of loan claims under a guarantee scheme, and the results are looking good. They reported that the remaining payout is ₹3.15 billion. Jefferies noted that this outcome adds some credibility to the bank, allowing it to boost provisions for any stressed loans while also shoring up its capital.
Outlook
Looking ahead, Macquarie thinks the claims payout could lead to a nice 15% bump in profit estimates for the bank’s fiscal year 2025. But let’s keep it real, Bandhan Bank has had its struggles, with gross non-performing assets rising to 4.23% as of June, up from 3.84% a few months back. Despite these bumps, Bandhan’s shares have had a rough year, down about 15%, while the broader Nifty bank index is up 7%.
