Shares of IDFC First Bank tanked 10 per cent and hit a new low of Rs 18.60 on the BSE on Friday after the bank’s Managing Director and Chief Executive Officer (MD & CEO), V Vaidyanathan, sold 27.56 million shares for approximately Rs 58 crore to close ESOP loan availed by him.

The bank said that Vaidyanathan intends to sell another about Rs 35 crore worth of stocks today (March 20, 2020) to entirely repay the residual ESOP (employee stock ownership plan) Loan taken for exercising his ESOP shares to release his pledged shares. He holds 42.35 million shares, representing 0.88 per cent stake, after yesterday’s sale. READ THE EXCHANGE FILING HERE

In the past one month, IDFC First Bank’s stock price has tanked 54 per cent, as compared to 32 per cent decline in the S&P BSE Sensex in the same period.

“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 core 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 company.

“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 said.

At 10:08 am, the stock had erased its entire early morning losses and was trading 1 per cent higher at Rs 20.90 on the BSE, in line with the benchmark Sensex. Almost 35.7 million shares have changed hands on the counter on the NSE and BSE so far.

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