Public-sector United Bank of India recently stated that it will raise up to Rs 1,500 crore by allotting equity shares in more than one tranches, public issue or rights issue, to fund its growth needs during this fiscal.
The shareholders of the bank, at its annual general meeting, accepted the proposal to generate, suggest and assign equity shares not more than Rs 1,500 crore in more than one tranches.
To the capital support, there would be an addition of capital raise which would be granted by the government, the bank said in a regulatory filing. The stock of the bank closed at Rs 11.05 on BSE, down 0.36 percent from the previous close.
The bank’s board approved raising of equity capital, and the proposal will be subject to shareholders’ approval in the ensuing annual general meeting, the bank stated in a filing to stock exchanges.
According to Pawan Bajaj, Managing Director and Chief Executive Officer, the bank expected to grow by 12-14 percent during the current fiscal, and the capital would be used to fund its growth needs.
Raise in the Stock Market
The bank has stated that the equity capital can be raised by various means including qualified institutions placement (QIP), public issue or rights issue.
According to Bajaj told BusinessLine it needs to grow the business and for that we require capital. The company even expect to grow by 12-14 percent, primarily driven by growth in retail, MSME and agriculture sectors.
As reported by The Economic Times, the next meeting of the board of directors of the bank shall be held soon to approve raising equity capital not exceeding Rs 1,500 crore in one or more tranches during the financial year,” it said in a regulatory filing.[The views and opinions expressed in this article are those of the authors and do not necessarily reflect the views and/or the official policy of the website. ]