Sebi spikes ICICI charge

The capital market regulator has rejected ICICI Bank’s charge that a cabal of market manipulators had hammered its stock recently. The Securities and Exchange Board of India (Sebi), which trawled data on stock trades between September 8 and October 8, said there was no evidence of manipulative trading. On September 17, K.V. Kamath, managing director and CEO of ICICI Bank, had complained to the regulator that certain vested interests had mauled the stock after spreading rumours that the bank was in trouble. The private sector bank had also filed a first information report with the Economic Offences Wing of the Mumbai police against a bear cartel of brokers. Although it did not name anyone, the bank said it had conducted investigations to identify the source of misleading statements. “None of the major sellers were observed to be placing orders successively at lower price. There was no pattern observed regarding placement of successive orders at lower price by sellers to hammer down the price. There was no pattern of booking intra-day profits by major clients or brokers during this period,’’ Sebi said today. It added that the trading patterns in the stock were consistent with the shareholding of ICICI — where FIIs are in a majority — the general buying and selling behaviour by FIIs and the broad movements of the market during this period. A spokesperson for ICICI Bank did not wish to comment on Sebi’s observations. The regulator said the share prices of several leading financial services companies had suffered declines against the backdrop of a global crisis in the financial sector and liquidity fears. ICICI Bank had alleged that a malicious rumour had been spread to the effect that some of the top management were selling their stock in the bank. The ICICI Bank stock fell 12.5 per cent from Rs 640 on September 15 to Rs 560.30 on September 17. According to Sebi, the shareholding pattern of ICICI Bank for the quarter ended June 30 showed that around 68 per cent of the shares were held by FIIs/foreign entities. Similarly, figures for the next quarter that ended on September 30, 2008, showed that around 65 per cent of the shares of ICICI Bank were held by FIIs/ foreign entities (ADR), while the rest was with the Indian public, including institutions.