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Mumbai, Feb. 21 The share price of Centurion Bank of Punjab on Wednesday shot up 14 per cent on the BSE, spurred on by rumours of a possible merger with HDFC Bank.

The traded volumes as also the volume that came up for delivery were substantially higher than the average for the current month.

The stock of Centurion Bank of Punjab (CBoP) opened the day at Rs 51.50 on the BSE, touched a high of Rs 58.40 and low of Rs 50.10, finally closing the day at Rs 57.05.

As many as 1.5 crore shares changed hands as compared to the average volume of 20.82 lakh shares on the BSE, while the deliverable quantity was around 16.77 per cent of the total traded quantity.

On the NSE, the volumes crossed over two crore, with a little more than a fifth (23 per cent) of it coming up for delivery at close.

HDFC Bank officially denied the rumours while CBoP declined to comment on ‘speculative reports’.

But no matter, the analyst community see some synergy.

“If the merger happens, HDFC Bank will expand branch network in the North and South where Centurion Bank of Punjab has a strong foothold.

HDFC Bank, on the other hand, has a strong presence in the western region and so both will complement each other. It will help the bank offer stiffer competition to rival ICICI Bank,” said an analyst with a Mumbai-based brokerage firm.

The major shareholders in CBoP are BankMuscat at 14.02 per cent, followed by Kephinance Investment Mauritius Pte Ltd at 6.13 per cent stake.

Mr Rana Talwar’s Sabre Capital which holds management control, has a stake of 3.48 per cent.

CBoP has 394 branches and 452 ATMs. It has an employee base of 7,500. HDFC Bank has a branch network of 754 and 1,906 ATMs in 327 locations.

The market capitalisation of CBoP and HDFC Bank stand at Rs 10,600 crore and Rs 54,586 crore, respectively.

More Stories on : Private Banks | Mergers & Acquisitions | HDFC Bank Ltd

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