The public sector bank said that it has received approval of DIPAM, Ministry of Finance, Government of India, for divestment of the bank's entire/part stake in UTI Asset Management Company in single or multiple tranches.
UTI Asset Management Company (UTI AMC) is the investment manager to the schemes of UTI Mutual Fund. It also manages offshore funds and provides support to the Specified Undertaking of the Unit Trust of India. The AMC had recorded a turnover of Rs 1,060.27 crore in FY 2021-22.
The AMC has been promoted by four sponsors, namely, State Bank of India, Life Insurance Corporation of India, Bank of Baroda and Punjab National Bank and presently, they collectively hold 45.16% of the shares of UTI AMC.
"The bank has decided to divest its part/entire stake in UTI AMC in single or multiple tranches for realization of gain on investment, PNB said in a statement.
Following the announcement, shares of Punjab National Bank zoomed 6.40% to currently trade at Rs 54.05 on the BSE.
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Concurrently, the scrip of UTI AMC advanced 4.28% to Rs 718.85.
As on date, PNB held 15.22% stake or 1.93 crore shares of UTI AMC. At the current market price, gross proceeds that would accrue to PNB from the said divestment is Rs 1,388.91 crore.
Punjab National Bank (PNB) is the second largest public sector bank (PSB) and the third largest bank in the Indian banking system. It is engaged in the business of treasury, corporate/wholesale banking, retail banking, and other banking operations. The Government of India (GoI) held 73.15% stake in the bank as on 30 September 2022.
The bank's net profit declined 62.8% to Rs 411.27 crore despite of 8.2% rise in total income of Rs 23,001.26 crore in Q2 FY23 over Q2 FY22.
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