Tag: equity shares

Bank of Maharashtra raises ₹403cr via QIP

Banking & Finance

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Bank of Maharashtra (BoM) has raised ₹403.70 crore via qualified institutions placement (QIP) issue of equity shares.

The public sector bank’s issue committee on Friday approved closure of the QIP issue of equity shares following receipt of application forms for an aggregate of ₹17.03 crore fully paid up equity shares of the bank and funds amounting to ₹403.70 crore in the escrow account from eligible qualified institutional buyers.

Also read: Bank of Maharashtra signs MoU with NABARD

The committee also determined and approved the issue price of ₹23.70 per equity share (including a premium of ₹13.70 per equity share).

The issue price is at a discount of 4.78 per cent (₹1.19 per equity share) to the floor price of ₹24.89 per equity share, BoM said in a regulatory filing. The bank’s QIP issue had opened on July 13.

BoM had allotted 73.60 crore equity shares of ₹10 each to the government of India at an issue price of ₹11.29 per equity share on August 25, 2020, against capital infusion of ₹831 crore. It also raised Tier II capital of ₹505.70 crore in FY21.

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To power FY22 advances growth, Bank of Maharashtra eyes ₹2,000 cr fund raise

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Bank of Maharashtra (BoM) has embarked on an exercise to mop up ₹2,000 crore via qualified institutions placement (QIP) of equity shares in a bid to support its FY22 advances growth target of 16-18 per cent.

The Pune-headquartered public sector bank expects to tap the QIP route, comprising core issue size of ₹1,000 crore and a green shoe option of ₹1,000 crore, by July-end.

AS Rajeev, MD & CEO, observed that the Bank’s target is to increase the advances portfolio to at least ₹1.25 lakh-crore by March-end 2022 against ₹1,07,654-crore as at March-end 2021.

“The envisaged increase in advances of ₹20,000-25,000 crore will absorb around ₹1,500 crore of capital. We will raise another ₹1,000 crore either via Additional Tier-I or Tier-II bonds by March-end 2022,” he said in an interaction with BusinessLine.

The resources raised via QIP and bond routes is expected to take care of the advances growth for the next one to one-and-a-half years. “We posted ₹550 crore net profit in FY21. We are envisaging 25-30 per cent growth in net profit (in FY22). This will also further increase our capital. So, for another two years, we will not require any capital. This is the plan,” Rajeev said.

After the fund raising and plough back of profit, BoM’s capital to risk-weighted assets ratio is likely to go up to 15 per cent by March-end 2022 from 14.49 per cent as at March-end 2021.

Tweaking loan composition

Rajeev underscored that the retail, MSME and agriculture (RAM), and corporate (government guaranteed advances) advances could increase by about ₹15,000 crore and ₹10,000 crore, respectively, so that the retail to wholesale advances ratio in overall portfolio moves to 65:35 as at March-end 2022, against 67:33 as at March-end 2021.

Within emergency healthcare services, BoM’s pharma sector exposure could go up from about 2 per cent of total advances to 4-4.5 per cent. “Funding support is needed by the sector to manufacture Covid-19 related vaccines and medicines,” Rajeev said.

Higher recovery target

BoM is eyeing a higher recovery target of ₹3,000 crore in FY22 against ₹1,644 crore in FY21. “Our target is to bring down Net Non-Performing Assets (NPAs) below 2 per cent by March-end 2022 (from 2.48 per cent as at March-end 2021) and Gross NPAs below 6 per cent (from now 7.23 per cent),” Rajeev added.

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Bank of India EGM next week to seek shareholders’ nod for preference shares to govt, BFSI News, ET BFSI

Banking & Finance

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New Delhi, Apr 30 () State-owned Bank of India (BOI) has convened extraordinary general meeting (EGM) of shareholders next week to seek approval for issuance of equity shares to government for capital infusion of Rs 3,000 crore. EGM of the shareholders of Bank of India will be held on Wednesday, May 5, 2021 through video conferencing and other audio visual means, the bank said in a regulatory filing.

The board will seek consent of shareholders of the bank to issue and allot up to 42,11,70,854 equity shares for cash at Rs 71.23 per equity share including premium of Rs 61.23 aggregating up to Rs 3,000 crore on preferential basis to government, the bank said in a regulatory filing.

The government in March had sanctioned to infuse the capital in BOI as part of equity during the financial year 2020-21.

Bank of India said it has been growing very diligently and cautiously for the last many years and there is a constant requirement to augment capital.

In order to meet this growing requirement, bank needs long term capital, it added.

The lender said it will utilise the funds to shore up the capital adequacy of the bank and to fund the general business needs of the bank.

After the preferential issue of shares, government’s shareholding in bank will go up to 90.34 per cent from 89.10 per cent now.

Stock of the bank closed at Rs 66.35 apiece on the BSE, down 1.63 per cent from the previous close. KPM MKJ



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Jana Small Finance Bank files DRHP for IPO after missing deadline, BFSI News, ET BFSI

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Kolkata: TPG-backed Jana Small Finance Bank has on Thursday filed its draft red herring prospectus with Securities & Exchange Board of India for an initial public offer, almost a week after missing the listing deadline.

Jana was supposed to be listed on or before March 27, 2021, according to the licensing agreement with Reserve Bank of India.

The bank had applied to the RBI for an extension till March 28, 2022 but the regulator turn it down.

“The RBI may take regulatory action against us, which could include imposition of monetary penalties, revocation of the RBI final approval or such other penal actions”, if it fails to make satisfactory progress towards the listing of equity shares or do not comply with the provisions of the extant RBI guidelines, the bank said in its prospectus.

The regulator has mandated small finance banks to get listed within three years from the date of commencement of our banking business or withing three from reaching a net worth of Rs 500 crore.

Jana received the banking license in 2015 along with nine other financial services firms.

The bank would be looking to raise up to Rs 700 crore through the proposed share sale. The bank may also consider a pre-IPO placement for raising up to Rs 500 crore, the bank said in the prospectus.

The IPO would include an offer for sale of up to 9,253,659 equity shares.

Bajaj Allianz Life Insurance Company, ICICI Prudential Life Insurance, Enam Securities and Hero Ventures will be looking to partly offload their holdings in Jana Small Finance Bank when the bank will float the IPO.

Some 18 existing investors would be looking to sell their holding, the bank said. The selling shareholders includes Gawa Capital, Client Rosehill Ltd, Tree Line Investment Management, North Haven Private Equity Asia Platinum Pte Ltd, QRG Enterprises and Bajaj Allianz General Insurance Company.

North Haven is the biggest shareholder with 8.18% holding who will be looking to sell shares while all the other selling shareholders hold less than 5%.

Promoters hold 42% in the bank while investment firm TPG holds 9.44%. Other investors include HarbourVest, Morgan Stanley and Tata Capital.

The bank’s genesis dates back to 2006 when it was founded as Janalakshmi Financial Services by former Citibank executive Ramesh Ramanathan, who is now non-executive chairman.



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Suryoday Small Finance Bank wants to raise Rs. 582 via IPO, BFSI News, ET BFSI

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The Reserve Bank of India had made it mandatory for the Small Finance Banks to hit the capital market within three years of operations. Pandemic slowdown the process for many of the SFBs, Just after Utkarsh Small Finance Bank filed for an IPO, Suryodaya too disclosed its plans.

Suryoday has decided to launch their initial public offer of equity shares of face value of ₹10 each on 17th March 2021. The Issue will close on 19th March 2021. The price band of the Offer has been fixed at ₹303 to ₹305 per Equity Share.

The Issue comprises of a fresh issue of up to 8,150,000 Equity Shares and an offer for sale of up to 10,943,070 Equity Shares. The Issue includes a reservation of up to 500,000 Equity Shares for subscription by eligible employees under the “Employee Reservation Portion” which is hereinafter referred to as “Net Issue”.

The Bank and the Selling Shareholders in consultation with the Book Running Lead Managers, may offer a discount of up to 10% (equivalent of ₹ 30 per equity share) of the issue price to eligible employees bidding in the Employee Reservation Portion (“Employee Discount”).

Suryoday Small Finance Bank said in a statement, “The bank has undertaken a Pre-IPO placement of 5,208,226 Equity Shares comprising (i) a private placement of 3,084,833 Equity Shares to SBI Life Insurance Company Ltd, 1,713,795 Equity Shares to Axis Flexi Cap Fund, 342,760 Equity Shares to Axis Equity Hybrid Fund, 66,838 Equity Shares to Kiran Vyapar Ltd.”

The Issue is being made through the Book Building Process, wherein not more than 50% of the Net Issue shall be allocated on a proportionate basis to Qualified Institutional Buyers, provided that the Bank and the Selling Shareholders may, in consultation with the Book Running Lead Managers, allocate up to 60% of the QIB Portion to Anchor Investors on a discretionary basis in accordance with the SEBI ICDR Regulations.

In the event of under-subscription, or non-allocation in the Anchor Investor Portion, the balance Equity Shares shall be added to the Net QIB Portion. Further, 5% of the Net QIB Portion shall be available for allocation on a proportionate basis only to Mutual Funds, and the remainder of the Net QIB Portion shall be available for allocation on a proportionate basis to all QIBs.

Further, not less than 15% of the Net Issue shall be available for allocation on a proportionate basis to Non-Institutional Bidders and not less than 35% of the Net Issue shall be available for allocation to Retail Individual Bidders in accordance with the SEBI ICDR Regulations, subject to valid Bids being received at or above the Issue Price.

All potential Bidders (except Anchor Investors) are required to mandatorily utilise the Application Supported by Blocked Amount (“ASBA”) process providing details of their respective ASBA accounts, and UPI ID in case of RIBs using the UPI Mechanism, if applicable, in which the corresponding Bid Amounts will be blocked by the SCSBs or under the UPI Mechanism.

Axis Capital Limited, ICICI Securities Limited, IIFL Securities Limited and SBI Capital Markets Limited are the Book Running Lead Managers to the Issue



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