PNB to sell 26 per cent in housing finance arm to US firm

20 May 2009

Punjab National Bank, the country's second-largest public sector lender, will sell a 26-0per cent stake in its housing finance arm to US-based Dawnay Day for about Rs77 crore.

"Today the board has decided to divest a 26 per cent stake in PNB Housing Finance Ltd," chairman and managing director K C Chakrabarty said, adding, "we have invested Rs7 crore and expects to get 10-11 times from the 26-per cent stake sale.

The US-based Dawnay Day will be PNB's strategic partner in the housing finance arm, he said while speaking to reporters after announcing the results for 2008-09.

The board PNB has approved dilution of up to 49-per cent stake in the housing finance company, he added.

However, he said, any decision to further dilute the stake in PNB Housing Finance Ltd, a wholly-owned subsidiary of the bank, would be taken at the appropriate time. 

PNB,meanwhile, has decided to to set up a joint venture for factoring services with the Malta-based Fin Bank.  The Malta bank would hold 40 per cent stake while PNB and other investors will hold 60 per cent in the joint venture, he said.