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SKS Microfinance tumbles as IRDA imposes penalty of Rs 50 lakh

21 Feb 2013 Evaluate

SKS Microfinance is currently trading at Rs. 143.00, down by 3.70 points or 2.52% from its previous closing of Rs. 146.70 on the BSE.

The scrip opened at Rs. 142.10 and has touched a high and low of Rs. 144.80 and Rs. 141.20 respectively. So far 112526 shares were traded on the counter.

The BSE group 'B' stock of face value Rs. 10 has touched a 52 week high of Rs. 198.90 on 13-Dec-2012 and a 52 week low of Rs. 54.40 on 05-Jun-2012.

Last one week high and low of the scrip stood at Rs. 150.50 and Rs. 133.10 respectively. The current market cap of the company is Rs. 1548.52 crore.

The promoters holding in the company stood at 26.97% while Institutions and Non-Institutions held 40.09% and 32.94% respectively.

Insurance regulator, Insurance Regulatory and Development Authority (IRDA) has imposed a penalty of Rs 50 lakh on SKS Microfinance as a corporate insurance agent; it collected extra funds, apart from the premium, without proper disclosure to policy-holders. The amount would be payable within 15 days from the date of receipt of the order.

As per the order of Insurance regulator, a micro finance institution (MFI), which also operates as a corporate insurance agent, can’t collect more amount than the premium charged for the policy on behalf of an insurance company. SKS Microfinance acted as a corporate agent of Bajaj Allianz Life Insurance Company.

SKS Microfinance (SKS) is a non-banking finance company (NBFC), registered and regulated by the Reserve Bank of India, whose mission is to provide financial services to low-income households. SKS operates across 17 states of India.

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