Home / Industry / Banking /  Punjab National Bank gets govt approval to dilute stake in UTI Mutual Fund

State-owned Punjab National Bank (PNB) on Thursday said it has received the government approval to divestment its entire stake in UTI Asset Management Company Limited as part of its non-core asset sale plan to shore up its capital base.

The bank, which holds 15.22% stake in UTI AMC, will divestment its entire stake in the mutual fund company in single or multiple tranches for realization of gain on investment. It's current valuation stands at 1,329 crore.

"The Exchange is hereby informed that the Bank has received approval of DIPAM, Ministry of Finance, Government of India for divestment of Bank's entire/part stake in UTI Asset Management Company Limited in single or multiple tranches subject to compliance of SEBI Regulations/other applicable regulatory guidelines," the bank said in a regulatory filing.

The timeline for making the divestment is yet to be finalized, the bank said.

PNB is one of the sponsors of India's oldest mutual fund company. Besides PNB, State Bank of India, Life Insurance Corporation of India, Bank of Baroda and US-based T Rowe Price are other sponsors.

Meanwhile, the private lender's had reported a 62.8% dip in net profit to 411.3 crore for the July to September quarter. This is against a net profit of 1,105.2 crore in the year-ago period.

The bank's net interest income (NII) grew by 30.2% to 8,271 crore in the quarter under review from 6,352.8 crore a year ago.

On Thursday, shares of PNB settled at 50.80 apiece, up 0.89% on the NSE.

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