Federal Bank and Jana Small Finance Bank shares fell by as much as 4.5% and 3.5%, respectively, after a report said the Kerala-based lender was in advanced stages of discussions to acquire a controlling stake in Jana Small Finance Bank.
Federal Bank shares declined as much as 4.5% to Rs 341.80, while Jana Small Finance Bank fell up to 3.5% to Rs 560.95.
CNBC-TV18 reported that Federal Bank was looking to acquire a controlling stake in Jana Small Finance Bank and that the two lenders were likely to be at an advanced stage of the proposed deal. The report also said Jana Small Finance Bank's promoter was considering the sale of its entire holding as part of the transaction.
The report comes as Jana Small Finance Bank seeks to move beyond its current status as a small finance bank. The lender applied to the Reserve Bank of India in June 2025 for voluntary conversion into a universal bank, but the central bank returned its application in October 2025, citing the lender's failure to meet the prescribed eligibility criteria.
Jana Holdings, the promoter of Jana Small Finance Bank, held a 16.94% stake in the lender, according to the latest shareholding data available on the BSE.
Federal Bank, responding to the report, said it evaluates opportunities for business growth and expansion in the normal course but added that there was no material development requiring disclosure under SEBI's listing regulations.
"We wish to mention that the Bank evaluates various opportunities in the ordinary course, for growth and expansion of its business. Further, we clarify that there is no material event/information that requires disclosure under Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015," Federal Bank said in an exchange filing.
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