The Bank of Baroda share price rose in trade today after the government said it would infuse Rs 5,042 crore into the state-owned lender ahead of merger with two other public sector lenders Dena Bank and Vijaya Bank. Bank of Baroda share price rose 6.21% to 129.10 compared to the previous close of 121.55 on BSE. The merger of Dena Bank and Vijaya Bank with BoB would be effective from April 1.
Stock has been gaining for the last three days and has risen 8.54% during the period.
During last one year, Bank of Baroda share price has lost 9.77% and gained 8% since the beginning of this year.
The finance ministry through its notification on Wednesday conveyed its decision to infuse capital of Rs 5,042 crore in BoB, the bank said in a regulatory filing.
"The capital infusion will be by way of preferential allotment of equity shares (special securities/bonds) of the bank during FY2018-19, as government's investment," it said.
According to the Scheme of Amalgamation, shareholders of Vijaya Bank will get 402 equity shares of BoB for every 1,000 shares held. In the case of Dena Bank, its shareholders will get 110 shares for every 1,000 shares of BoB.
The government in September last year had announced merger of Vijaya Bank and Dena Bank with Bank of Baroda, aiming to create the third-largest lender after SBI and ICICI Bank.
Edited by Aseem Thapliyal