Lakshmi Vilas Bank said that the Bank will continue to share information on material developments as and when they materialize
The aim is to find the candidate for the MD & CEO post as soon as possible, "like say in a one-and-half months", Sinha noted.
Lakshmi Vilas Bank share price zoomed 16 per cent to Rs 20.30 apiece on BSE, a day after the bank informed that it has received an indicative non-binding offer from Clix Group. With today’s gain in stock price, Lakshmi Vilas Bank has rallied nearly 100 per cent from March lows. As per the offer, the private equity firm comprising Clix Capital Services Private Limited, Clix Finance India Private Limited and Clix Housing Finance Private Limited would be amalgamated with Lakshmi Vilas Bank. “Lakshmi Vilas Bank is in urgent requirement of capital as the banks Capital Adequacy ratio stands at 1.12 per cent as of Q4FY21 against the RBI requirement of 8 per cent. RBI might consider Clix and LVB merger the first option as this could be the fast solution as Clix has done the due diligence of the business. If this option fails then it may consider merging with a bigger bank,” said Jaikishan Parmar, Senior Equity Research Analyst at Angel Broking Ltd.
“Further to the process of considering and evaluating the proposed amalgamation with Clix Capital Services Private Limited (Clix Capital), Clix Finance India Private Limited (Clix Finance) and Clix Housing Finance Private Limited (Clix Housing), (collectively, the Clix Group), we are glad to inform that, the Bank has received an indicative non-binding offer from Clix Group,” Lakshmi Vilas Bank said in an exchange filing.
Lakshmi Vilas Bank also added that the Bank will continue to share information on material developments as and when they materialize. Last month, the bank informed that the mutual due diligence for the merger with Clix Group was substantially complete. On September 25 the bank’s shareholders rejected the reappointment of seven directors of the bank, including the interim managing director and chief executive officer. Reserve Bank of India (RBI) appointed a three-member team to run the bank under Meeta Makhan as chairperson and Shakti Sinha and Satish Kumar Kalra as members.
On Wednesday, Credit rating agency Brickwork Ratings (BWR) had downgraded the ratings to ‘BWR B+’/ credit watch with negative implications for the long-term bonds of Rs 50.50 crore of Lakshmi Vilas Bank. The bank in an exchange filing said that the proposed amalgamation is expected to address the concerns on the bank’s capital, reduce net NP As and initiate efforts to exit the PCA required for its business growth.
Around 10.30 AM, Lakshmi Vilas Bank shares were trading 13.20 per cent higher at Rs 20.15 apiece, as compared to a 0.27 per cent rise in S&P BSE Sensex.