Axis Bank's shares declined by more than 2 per cent on Friday after BJP's Subramanian Swamy filed a petition with the Delhi High Court, claiming a scam worth Rs 1,500 crore involving Axis Bank. Swamy alleges that the private bank made unjustified profits from dealings in shares of Max Life Insurance.
The BJP leader's petition contends that there is 'blatant' fraud within Max Life Insurance and Max Financial Services. According to a report by Bar and Bench, Max Life Insurance and Max Financial Services allegedly permitted Axis Bank Ltd and its affiliated companies, Axis Securities Ltd and Axis Capital Ltd, to generate 'undue profits' from trading equity shares of Max Life in a non-transparent manner.
Swamy stated in his plea that the transactions breached the mandatory directives of the Insurance Regulatory and Development Authority of India (IRDAI).
“On simple calculation, resulting to make undue profits/gains from the purchase on the sale of equity shares of Max Life in a non-transparent manner, Axis Bank has unlawfully gained approx Rs 4000 Crores,” the plea read.
He further added that the bank's group entities acquired a 12.002 per cent stake in Maxlife at a price ranging from Rs 31.51 to Rs 32.12 per share, totaling 736 Crores. This amount, according to him, is very clearly lower than the fair market value.
At 09:35 am, the shares of the banking firm were trading at Rs 1068 price level, down by 0.29 per cent on the National Stock Exchange.
