South Indian Bank jumps after RBI lifts ban on purchases by foreign investors

South Indian Bank jumped 5.8% to Rs 27.90 at 9:55 IST on BSE after the Reserve Bank of India withdrew restrictions placed on the purchase of shares of the bank by foreign investors with immediate effect.

The Reserve Bank of India made announcement after market hours yesterday, 24 February 2015.

Meanwhile, the S&P BSE Sensex was up 210.48 points or 0.73% at 29,216.28.

On BSE, so far 5.11 lakh shares were traded in the counter as against average daily volume of 10.78 lakh shares in the past two weeks.

The stock hit a high of Rs 28.30 and low of Rs 27.10 so far during the day. The stock had hit a record high of Rs 35.05 on 7 July 2014. The stock had hit a 52-week low of Rs 20.40 on 24 February 2014.

The stock had underperformed the market over the past one month till 24 February 2015, falling 5.72% compared with 0.94% fall in the Sensex. The scrip had also underperformed the market in past one quarter, dropping 5.22% as against Sensex's 1.77% rise.

The mid-cap private sector bank has equity capital of Rs 135.02 crore. Face value per share is Re 1.

The Reserve Bank of India notified that the aggregate share holdings in The South Indian Bank by non-resident Indians (NRI)/persons of Indian origin (PIO)/foreign institutional investors (FII)/registered foreign portfolios investors (RFPIs) and through global depository receipts (GDR)/American depository receipts (ADR)/foreign direct investment (FDI) in the primary/secondary markets have gone below the prescribed threshold ban limit stipulated under the extant FDI policy. Hence the restrictions placed on the purchase of shares of the above bank are withdrawn with immediate effect. The foreign investment limits are subject to Regulation of FEMA Notification No.20/2000-RB dated 3 May 2000 (as amended from time to time) and other terms and conditions stipulated by the Reserve Bank.

The RBI had allowed upto 49% of FII investment in the bank.

Foreign institutional investors held 32.09%, NRIs/foreign individuals/foreign nationals held 5% and foreign non institution others held 11.07% in the bank as at 31 December 2014.

South Indian Bank's net profit fell 37.8% to Rs 87.93 crore on 9.9% rise in total income to Rs 1467.13 crore in Q3 December 2014 over Q3 December 2013.

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