Federal Bank shares fall 4% after Jana SFB deal report; what lender says

Federal Bank Ltd and Jana Small Finance Bank (Jana SFB) saw their shares falling in Tuesday's trade after the former has issued a clarification on a news report that suggested a potential deal between the two lenders were in advanced stages. CNBC-TV18 had earlier reported that Federal Bank was looking to acquire a controlling stake in Jana SFB.

In its exchange filing, Federal Bank said it evaluates various opportunities in the ordinary course, for growth and expansion of its business. That said, "there is no material event/ information that requires disclosure under Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.”

Following the clarification, Federal Bank shares fell 4.49 per cent to hit a low of Rs 341.80 on BSE. Jana SFB was trading 1.96 per cent lower at Rs 570.45 apiece. CNBC-TV18 earlier reported said Jana SFB's promoter was likely to sell its entire 16.9 per cent stake. The report also said Federal Bank was expected to launch an open offer following the promoter stake purchase.

Federal Bank shares are up 20.45 per cent in the past three months compared with a 1.4 per cent rise in the BSE Sensex during the same period. Jana SFB, on the other hand, jumped 18.92 per cent in the period mentioned.  The BSE Financial Services index rose 3.25 per cent during the said period.

The clarification was issued under Regulation 30(11) of the SEBI Listing Obligations and Disclosure Requirements Regulations, 2015, which covers clarification on news reports appearing in mainstream media.