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Canara Bank and Bank of Maharashtra (BoM) on Friday announced fund raising plans amounting to ₹8,000 crore and ₹3,000 crore, respectively, via equity and Basel III compliant bonds.
Canara Bank said its board approved raising of equity share capital amounting up to ₹5,000 crore (including premium) in FY21.
The equity capital raise will be by way of Qualified Institutional Placements (QIP), Rights Issue/Employee Stock Purchase Scheme (ESPS)/Private Placement/ Preferential Allotment/any other approved means during the Financial Year (FY) 2020-21 subject to market conditions and necessary approvals.
Further, the Bengaluru-headquartered public sector bank’s board also green-lighted the proposal to raise capital through AT I Basel III compliant Bonds to the extent of ₹3,000 crore during the FY2020-21 subject to market conditions and necessary approvals.
Bank of Maharashtra
Bank of Manarashtra’s board considered and approved raising of capital aggregating up to ₹2,000 crore (including share premium).
The equity capital raise will be by way of preferential allotment to the Government of India/ financial institutions/ others and/ or by way of QIP issue/ Further Public Offer/ Rights issue and/ or AT 1 bonds.
In a stock exchange notice, the Pune-headquartered bank said its board has okayed the issue of equity shares to the Government of India for an amount aggregating ₹831 crore on preferential basis.
BoM also said it will be raising ₹1,000 crore by way of issue of Basel III complaint Tier I/ II bonds or such other securities at an appropriate time, subject to necessary approval/ permissions.
Set-off accumulated losses
Further, BoM’s board gave its nod to set-off the accumulated losses of the bank as on March-end 2020 against the balance available in its share premium and special reserves account as on the date of the set-off.
The bank said this move is aimed at presenting a true and fair view of its financial position and take the same into account during the current financial year (FY21), subject to necessary approvals/ permissions.
Meanwhile, State Bank of India informed the exchanges that a meeting of its Central Board is scheduled to be held on July 15 to consider and approve raising of Additional Tier 1 (AT 1) and Tier 2 Capital by way of issuance of Basel III compliant debt instrument in USD and/or INR during FY21.
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