Shares of IDFC Bank
and Capital First
gained in the early morning trade on Wednesday on the BSE. The company announced the completion of merger following the receipt of all requisite shareholder and regulatory approvals and the merged entity will be called IDFC First Bank, subject to shareholders’ approval.
Following the merger, the Board of IDFC Bank approved the appointment of V. Vaidyanathan, Founder and Chairman of Capital First Ltd, as Managing Director and Chief Executive Officer of the merged entity, subject to shareholders’ approval.
IDFC First Bank will now offer a wider array of retail and wholesale banking products, services and digital innovations, to a greater number of customer segments. It will serve 7.2 mn customers through its 203 bank branches, 129 ATMs, 454 rural business correspondent centres across the country’s urban and rural geographies.
The Boards of IDFC Bank and Capital First Ltd met on Tuesday to take note of all requisite approvals and the order from National Company Law Tribunal; and approved the scheme of amalgamation. The Board of IDFC Bank also approved the appointment of Dr. Rajiv Lall, Founder MD & CEO of IDFC Bank, as Part-time Non-Executive Chairman of IDFC First Bank, subject to approval from the RBI. The reconstituted board of the merged entity now stands expanded with the induction of five new directors.
In his initial comments, V. Vaidyanathan, MD & CEO of IDFC First Bank, said, “The merger presents an incredible opportunity to strengthen our banking capabilities, operate as a larger universal bank and bring immense benefits to our customers.”
“We believe our complementary portfolio gives the combined entity access to high-growth customer segments. It enables us to enhance the lending platform and fast-track the building of the liability franchise, by offering customers a broader set of solutions. We look forward to enriching banking experience for the masses, by delivering technology-led quality banking services.”
On a combined basis, IDFC First Bank has on-book loan assets of Rs1,02,683cr, as per the last reported financial results for the quarter ended September 30, 2018. The retail loan book will now contribute 32.46% to the overall loan book.
The merger was announced on January 13, 2018, and as per the terms of the merger agreement shareholders will receive 139 shares of IDFC Bank for each 10 shares held of Capital First Ltd.
IDFC Bank Ltd is currently trading at Rs41.05 down by Rs0.05 or 0.12% from its previous closing of Rs41.10 on the BSE. The scrip opened at Rs42.35 and has touched a high and low of Rs42.50 and Rs41 respectively.
Capital First Ltd
is currently trading at Rs571.75 up by Rs3.95 or 0.7% from its previous closing of Rs567.80 on the BSE. The scrip opened at Rs581 and has touched a high and low of Rs583.75 and Rs564 respectively.