Mumbai, Sep 4 (IANS) Huge selling pressure was seen in the troubled United Western Bank stock Monday, as four leading banks ICICI Bank, Canara Bank, Andhra Bank and Federal Bank queued up to acquire the struggling bank placed under moratorium by the Reserve Bank of India (RBI).

The United Western Bank (UWB) Saturday was placed under moratorium till Dec 1 by the central bank to protect depositors and said the aim was to merge it with a stronger one.

Inefficient management led to the erosion of net worth of the UWB.

On the Bombay Stock Exchange, Monday UWB share price dropped to Rs.10, representing a fall of over 55 percent from Friday's close of Rs.22.55 per share.

The bank's share price dropped to as low as Rs.5.25 early in the morning trade, representing a drop of 77 percent from the previous close of Rs.22.7., on the National Stock Exchange.

The stock recovered some of the lost ground by noon at Rs.15.15 - a drop of 33 percent.

"The shares can go down to any level as there are maximum selling orders and market analysts are advising not to touch the stock at any fall," said Rajiv Malik, a broker.

"A takeover is unlikely to give its shareholders a good deal," Malik told IANS.

Meanwhile, India's second largest lender ICICI Bank said Monday its board had approved a bid for the struggling UWB, whose rural network could help boost its operations.

"ICICI Bank believes UWB's network can be leveraged to grow its rural and small and medium enterprise banking operations in particular and its overall distribution franchise in general," ICICI said in a statement.

But, ICICI will face stiff competition from state-run lenders such as Canara Bank and Andhra Bank that also plan to bid for UWB. Federal Bank is also bidding for the ailing bank.

All these banks have queued up to acquire UWB, as it will give them a huge presence in Western India and a readymade infrastructure.

The UWB has 230 branches, 12 extension counters and 75 ATMs spread across the rural belts in nine states.

"ICICI may find it hard to take over UWB, but if it succeeds the acquisition will help its reach. Given the central bank's preference for public sector banks for merger and with better reach in the terms of branches, ICICI may find the going tough," analysts pointed out.

Announcing the moratorium Saturday, RBI executive director Anand Sinha said: "Generally, preference is given to public sector banks (for merger)."

New York-listed ICICI, which has a market value of $11.7 billion, has about 614 branches and extension counters. In comparison, state-run Bank of Baroda, with a market value of about $2 billion, has 2,737 branches, analysts pointed out.

UWB has deposits of Rs.64.8 billion ($1.39 billion) and outstanding loans worth Rs.40.06 billion, according to the RBI.