Bandan Financial appears to be allowing long-term investors to exit

The company is said to have engaged global investment banker Jefferies to gauge investor interest, particularly from private equity funds. Bandan Finance’s board discussed the issue in its meeting on Monday, two people aware of the discussions told ET.

The exercise is also in line with regulatory norms that require Bandan Financial to reduce the promoter’s stake in the operating bank to 26% by 2030.

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Explore bank promoter private equity sale or go for ipo

“The promoter now owns less than 40% and it may consider downsizing,” said a person close to the bank.
The board discussed two possible ways for investors to exit. First, selling shares to existing investors to private equity funds and second, an initial public offering, people familiar with the matter said.

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The members argued that the sale to private investors could achieve a higher value for Bandan Financial Services, which owns 39.74% in Bandan Bank, and owns an asset management company, a life insurance company and a technology company.
Caladium Investment Pte, an investment vehicle for GIC Ventures, held a 16.7% stake in BFSL while IFC owned 13.6% as of March 31, 2025. Regional development finance body Small Industries Development Bank of India (SIDBI) held an 8.1% stake in it. Financial Inclusion Trust and North East Financial Inclusion Trust jointly owned 40.7% while Bandan Employees Welfare Trust held 14.6% at the same time. The launch of the sale exercise coincides with a recovery in Bandan Bank’s business performance in the microfinance vertical, which has been under severe asset quality pressure for the past two years.

BFSL’s net profit for the nine-month period is likely to be around ₹285 crore, significantly higher than FY25’s ₹104 crore, people are aware.

The board is said to have proposed a June deadline for the sale of private equity shares. If it doesn’t happen by then, the focus will shift entirely to the IPO.

Bandhan Financial Services Limited (BFSL) Chairman Chandrasekhar Ghosh did not respond to ET’s queries.

IFC has invested in BFSL since 2011 while GIC invested in it in 2015 to help transition Bandan Bank from a microfinance company. At present BFSL’s sole business is investment management. It owns 100% in Bandhan Financial Holding, which was incorporated in 2013 as a non-operating financial company under the Reserve Bank of India’s Private Banking Licensing Guidelines.