ICICI Bank hits over four-month low; falls 13% in six trading days

The stock dipped 6% in past two trading sessions after media report suggested that the bank's MD & CEO Chanda Kochhar was summoned by the SFIO in PNB scam

ICICI Bank dipped 3.3% to Rs 285 on the BSE on Wednesday in early morning trade, extending Tuesday’s 2.6% decline after media reports suggested that the bank’s Managing Director and Chief Executive Officer Chanda Kochhar was summoned by the Serious Fraud Investigation Office (SFIO) in Punjab National Bank (PNB) scam.

The stock of private sector lender is trading at its lowest level since October 24, 2017. In past six trading sessions, it fell 13% from Rs 327 on February 26, 2018, as compared to 3.6% decline in the S&P Sensex.

ICICI Bank Managing Director and Chief Executive Officer Chanda Kochhar and her Axis Bank counterpart Shikha Sharma were on Tuesday summoned by the SFIO in connection with the Rs 127-billion PNB fraud involving absconding diamantaire Nirav Modi and his uncle Mehul Choksi.

“In this connection, we draw reference to our earlier letter dated February 28, 2018 vide which we had informed you that the Bank routinely and regularly cooperates with regulatory authorities who require information in the course of their investigation,” ICICI Bank said in a clarification on the news item.

To provide assistance to the investigating authorities, representatives of ICICI Bank continue to engage actively and provide requisite inputs as routinely done in the case of all investigating authorities who approach the Bank.

We wish to clarify that in our view, the above news item will not have any material impact on the Bank or trigger any reporting under Regulation 30 of the SEBI Listing Regulations owing to the fact which we mentioned in our earlier letter as well that the Bank has no exposure to the Nirav Modi group of companies, nor has the Bank issued any Letter of Undertaking (LOUs); nor has any buyer’s credit exposure against LOUs with respect to the Nirav Modi group of companies as well as the Gitanjali group of companies.

The Bank is a part of the working capital lender consortium in the Gitanjali group of companies along with several other banks wherein its exposure is not the largest, it added.