Bandhan Bank share price tanks over 7% as Amphan cyclone rips through business

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Published: May 22, 2020 11:58:24 AM

Bandhan Bank said in its press release that the banking outlets which had received prior warning of the Amphan cyclone were prepared with the necessary safety and business continuity measures

Bandhan Bank, Amphan, Bandhan Bank shares were trading 5.22 per cent lower at Rs 199.75 apiece on the BSE, against 0.74 per cent decline in the S&P BSE Sensex

Bandhan Bank share price tanked 7.2 per cent to Rs 195.40 apiece on BSE in Friday’s weak trade after the bank in a stock exchange filing informed that the business of around 65,000 of micro banking borrowers, amounting to exposure of approximately Rs 260 crore, could be impacted due to the Amphan cyclone. “As per the initial assessment, 49 banking units (micro banking outlets) in five districts were impacted, of which 45 have resumed operations today,” Bandhan Bank said in a BSE filing. It further informed that the bank will not be able to continue services in five branches due to issues in accessibility. However, Bandhan Bank share price has risen over 28 per cent from its March low of Rs 152.35 apiece on BSE. While the stock is still off 70 per cent from its 52-week high of Rs 650 hit in October last year.

Bandhan Bank said in its press release that the banking outlets which had received prior warning of the Amphan cyclone were prepared with the necessary safety and business continuity measures which enabled the continuity of operations.

During the time when the country is already grappling with the coronavirus (COVID-19) pandemic, the Amphan cyclone has added more to the problems. Eight districts in West Bengal and six in Odisha have been severely impacted due to Amphan cyclone. “In the absence of district-wise exposure for banks, we are just looking at their overall exposure to these states to understand the impact on individual names. Bandhan Bank (with more than 30 per cent) and RBL Bank (with nearly 10 per cent) have relatively higher exposure to West Bengal,” ICICI Securities said in its latest research report.

At 11.40 am, Bandhan Bank shares were trading 5.22 per cent lower at Rs 199.75 apiece on the BSE, against 0.74 per cent decline in the S&P BSE Sensex. “In our experience of Fani, the cyclone that caused large scale damage in Odisha in May 2019, the impacted portfolio took 3 to 6 months to achieve normalcy, aided by the committed workforce and customer loyalty,” Bandhan Bank said. “On the back of this experience, we expect the Amphan affected portfolio to regularise by Q3 of FY21,” it added.

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