The ASX asked Bendigo Bank if it knew why its share price rose strongly this week and the bank said “no”.

On the face of it that was a perfectly reasonable question and answer.

So then later yesterday AAP reports this:

Australian regional lender Bendigo Bank Ltd can say “merci” for its surging share price to French bank BRED Banque Populaire, which has been buying up its stock in recent weeks.

Bendigo stock surged more than 10 per cent on Tuesday from its March 10 close of $9.06 to finish that day’s trading at $10.00, prompting a “please explain” from the Australian Securities Exchange.

Bendigo said it had no idea why its stock had bounced and the bank reaffirmed its profit guidance in its response to the ASX.

However market watchers said its newly-forged “French connection” may have sent a ripple of optimism through the market, encouraging investors to buy into the stock.

BRED Banque Populaire’s holding is still below the five per cent “substantial shareholder” limit but it is rubbish for Bendigo to say that because the 5% threshold hadn’t been reached there was no disclosure.

Last year when Brambles spotted Asciano (and then Toll Holdings) creeping into its share register with less than 2.5% it outed them straight away and kept updating the market on the attempt by the two companies to stalk their larger competitor.

If it was good enough for Brambles to disclose a less than 5% shareholding, it is also good enough for Bendigo Bank to disclose the march up its share register by the French bank.

Bendigo Bank knew why the share price rose: it just chose not to tell and instead hid behind a legalism.

Peter Fray

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Peter Fray
Editor-in-chief of Crikey