Fino Payments Bank Stock Recovering from 15% Plunge After Clarifications on CEO's Arrest

Fino Payments Bank Stock Rebounds After Intraday Losses

Market Update On Tuesday, Fino Payments Bank shares erased their intraday losses to trade marginally in the green, recovering from an early decline of up to 14 percent. The stock was trading at Rs 192.7 in morning deals, up 0.3 percent on the day.

Market Capitalization At the current price, the stock is down about 10.7 percent over the past one year, with the bank's market capitalization at around Rs 1,600 crore.

Investigation and Arrest The sharp early sell-off in Fino Payments Bank stock followed the bank's disclosure that its Managing Director and Chief Executive Officer, Rishi Gupta, had been arrested under the Goods and Services Tax (GST) law. The bank clarified that the arrest was linked to an investigation involving certain business partners and was not related to the bank's own GST compliance.

Read also: Expert Portfolio Manager Raja Venkatraman Names Top Investment Picks for June 4

Management Response The bank's management, led by Chief Financial Officer Ketan Merchant, who has been appointed Head of the Organisation in Gupta's absence, stated that the investigation pertains to programme managers associated with multiple banks. The bank has put in place enhanced monitoring and prudential buffers to ensure stability, according to the Informist.

Regulatory Update The development comes just a month after the Reserve Bank of India approved Gupta's reappointment as MD and CEO. Separately, Fino had received regulatory approval in December to convert into a small finance bank, which would allow it to accept larger deposits and offer credit products.