InvestorQ : With Clix looking to buy LVB, can we assume that the tough time for the bank may be finally over?
Anamika Sodhani made post

With Clix looking to buy LVB, can we assume that the tough time for the bank may be finally over?

Answer
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Angel dcosta answered.
3 weeks ago


After a tough few weeks, Lakshmi Vilas Bank surged 16% on Friday the bank reported it had received a non-binding offer from the Clix Group. Clix Capital is a private equity company that takes strategic stakes in businesses.

The process of due diligence is expected to be completed soon. The stock of LVB had crashed sharply after liquidity issues cropped up and Brickworks had even downgraded their bonds. There was also a management impasse in the bank.

The bank has s troubled past with high levels of gross NPAs and sustained losses for 10 quarters in succession. The bank was urgently in need of capital infusion to avoid another default and a downgrade to junk rating by the rating agencies.

Thanks to the interest shown by Clix, the trading volumes on the counter nearly doubled with over 23 lakh shares changing hands on the two exchanges. The pandemic and the subsequent lockdown only worsened matters for the bank; as was the case with many small sized banks in India.