Canara Bank's shares witnessed a notable uptick following the approval from its board for a stock split aimed at enhancing liquidity and accessibility for retail investors, thus broadening the bank's investor base.

The decision, announced during the early hours of February 17, saw the share price of the state-run bank edging up by nearly 1 per cent.

At 9:37 am, Canara Bank's shares were quoted at Rs 577.30, marking an increase of Rs 4.50, or 0.79 per cent.

The company disclosed that its board of directors, in a meeting held on February 26, 2024, greenlit the subdivision of each equity share with a face value of Rs 10 into five fully paid-up equity shares with a face value of Rs 2 each, subject to regulatory approval from the Reserve Bank of India (RBI).

This move is strategically aimed at improving the liquidity of Canara Bank's shares and making them more affordable for retail investors.

The anticipated timeline for completion is estimated to be two to three months from the intimation date of the Board Meeting, which took place on February 7, 2024, considering the requisite approval process from the RBI.

In a separate development, the RBI imposed a monetary penalty of Rs 32.30 lakh on Canara Bank for breaches in regulatory compliance.

The bank was found to have failed to rectify rejected data and timely upload it with Credit Information Companies (CICs) within seven days of receiving rejection reports.

Additionally, it restructured certain accounts that did not meet the standard asset criteria as of March 31, 2021, as per extant regulatory directives.

Earlier in the same month, Canara Bank successfully raised Rs 2,000 crore through the issuance of non-convertible, taxable, perpetual, subordinated, fully paid-up, unsecured Basel III compliant Additional Tier 1 bonds, each with a face value of Rs 1 crore, offering a coupon rate of 8.40 per cent.

Broking firm Motilal Oswal, in its research report dated January 24, 2024, recommended a buy rating for Canara Bank's stock with a target price set at Rs 570.

This positive outlook was bolstered by the bank's impressive financial performance, with a reported 26.87 per cent increase in net profit, reaching Rs 3656 crore for the October-December quarter of the fiscal year 2023-24.