Bank Asia sponsor Mostafa Steel to sell almost entire holding

Mostafa Steel Galvanizing, a corporate sponsor of Bank Asia, has declared to sell 98.3% of its holding in the bank.

The bank stated in a stock exchange filing on Thursday that the Mostafa Group concern will sell 5.9 lakh shares out of its holding of six lakh shares in Bank Asia at the prevailing market price in the block market through the Chittagong Stock Exchange (CSE) by the end of this month.

But the reason behind selling such a huge portion was not disclosed on the CSE website.

Seeking anonymity, Bank Asia officials said they did not know the reason either.

Bank Asia was listed on the stock exchanges in 2004. Its shares last traded at Tk20.5 apiece on Thursday at the CSE.

As of 31 August 2023, sponsor-directors held 53.35%, institutional investors 35.80%, foreign shareholders 0.21%, and general shareholders 10.64% shares in the bank.

The Chattogram-based Mostafa Group was one of the leading conglomerates in the consumer goods business from the 1980s through the 2010s.

But owing to the local and global fluctuation in consumer goods and steel products businesses, the group had to count losses between 2008 and 2012. Also, a few concerns of the group became defaulters of bank loans.

Consequently, the group had to shut down its consumer goods business.

Mostafa Group currently owes more than 30 banks and financial institutions nearly Tk2,000 crore.