Shares of Jammu and Kashmir (J&K) Bank plunged 20%

Srinagar: Shares of Jammu and Kashmir (J&K) Bank plunged 20% on Monday after its chairman and chief executive officer, Parvez Ahmed, was removed by the state government on Saturday.

At 11:50 am, the stock was trading at ₹49.40 down 16.90% on BSE while on NSE, the scrip slipped 17.26% at₹49.15.

During the early trade, the stock slumped 20% daily limit, its biggest intra-day percentage drop in over five years. The shares of the bank had touched the lowest level since 18 March of ₹47.55.

The Jammu and Kashmir government on Saturday removed chairman Parvez Ahmad and appointed its executive president R K Chibber as an interim chairman.

The government said it has decided to take long term measures to improve the functioning of the bank so that it becomes an example of a well managed government-owned bank and Ahmad’s removal was the first step in that direction.

The outgoing chairman said he did his job most diligently and honestly and was open to scrutiny.

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Anti-Corruption Bureau carried out a raid at the lender’s corporate office in connection with alleged fraudulent appointments.

“Parvez Ahmad, Chairman cum Managing Director, shall cease to be Director on the Board of Directors of the Bank and consequently be no longer the Chairman cum Managing Director of the board,” an order issued earlier by Additional Secretary, Finance, Vishal Sharma said.

The Nifty PSU Bank fell 1.27% with Jammu and Kashmir Bank is the biggest laggard.

J&K Bank had reported an over a seven-fold jump in its net profit at ₹214.8 crore in the fourth quarter of the fiscal ended March 2019. The t0otal income during the March quarter rose to ₹2,473.5 crore as compared with ₹1,763.95 crore in the same period of FY18. The bank’s gross NPAs declined to 8.97% of gross advances at the end of March 2019. (PTK)