PSU lender Canara Bank made a historic announcement on Monday, revealing that its Board has approved a stock split, splitting each share into five shares. This decision marks a significant milestone for Canara Bank, being the first time in its 118-year history that it has undergone a stock split. The purpose of this move is to democratize the ownership of the bank’s shares and attract a broader base of investors. The announcement was made through a filing with the stock exchange.

Canara Bank Set to Approve Stock Split

In a bid to expand its investor base and make its shares more accessible, Canara Bank has scheduled a board meeting for the 26th of February 2024 to discuss and approve a stock sub-division. The split aims to divide each existing share into five new shares, effectively increasing the number of outstanding shares and reducing the price per share. This strategic decision comes as Canara Bank seeks to increase market liquidity and attract a wider range of investors to participate in its ownership.

This unprecedented move by Canara Bank to split its shares is significant for several reasons. Firstly, it allows the bank to lower the price per share, making it more affordable for potential investors who were previously deterred by the high unit price. This is expected to stimulate demand for Canara Bank’s stock and potentially lead to an increase in trading volume. Additionally, by expanding its investor base, the bank can gain access to a larger pool of capital, enabling it to fund its growth initiatives and boost its financial standing.

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According to Canara Bank’s stock exchange filing, the split is aimed at democratizing the ownership of the bank’s shares and broadening its investor base.

Canara Bank’s stock split is a noteworthy development within the Indian finance sector, particularly for public sector banks. This strategic move could set a precedent for other banks to undertake similar actions, creating a ripple effect within the industry. As the split is yet to be approved in the board meeting, the exact details of the ratio and the record date for the split are still pending official announcement. Investors and market participants will be closely monitoring further updates from Canara Bank regarding this significant decision.

Key Points:

• Canara Bank’s Board has approved a stock split, dividing each share into five shares.
• This is the first time in Canara Bank’s history that a stock split has been carried out.
• The aim of the stock split is to democratize share ownership and attract a broader range of investors.
• A board meeting is scheduled for the 26th of February 2024 to approve the stock sub-division.
• The split is expected to lower the price per share, making it more affordable for potential investors.
• Expanding the investor base could provide Canara Bank with greater access to capital for growth initiatives.
• The exact ratio and record date for the split are yet to be announced.

Source: Canara Bank stock exchange filing