Canara Bank plans to raise up to Rs 8,000 cr in FY21

NEW DELHI: Canara Bank on Friday said its board has approved raising up to Rs 8,000 crore in the current financial year, and over half of this would be raised by issuing equity shares.

In an update on the outcome of the board meeting held on July 10 about 'Capital Raising Plan for 2020-21', Canara Bank said the board has approved raising equity share capital amounting up to Rs 5,000 crore through various means.

The equity capital would be raised by way of qualified institutional placement, rights issue, employee stock purchase scheme, private placement, preferential allotment or any other approved means, subject to market conditions and necessary approvals, the state-owned lender said in a regulatory filing.

The board has also decided "to raise capital through additional tier I Basel III compliant bonds to the extent of Rs 3,000 crore during FY2020-21 subject to market conditions and necessary approvals, it added.

A number of public and private sector banks have outlined their capital raise plans for the fiscal to meet their growing business and regulatory requirements.

While the country's largest lender SBI is planning to raise a whopping Rs 20,000 crore equity capital, PNB plans to hit the capital markets in the fourth quarter to mop up funds to help meet growth needs and regulatory requirements.

Among private peers, HDFC Bank has got its board nod for Rs 50,000 crore fund raise in this fiscal by issuing various debt securities.

Axis Bank is planning to raise up to Rs 35,000 crore through debt and Rs 15,000 crore by issuing equity shares. Similarly, Yes Bank will hit the market with its follow on public offer next week seeking to raise up to Rs 15,000 crore equity capital.

ICICI Bank is targeting to raise Rs 15,000 crore after having already raised Rs 2,250 crore this fiscal by selling stakes in its subsidiary firms.

Federal Bank has received board nod for raising up to Rs 12,000 crore, majority of which is targeted to come through borrowing instruments.

Earlier on Friday, Pune-based Bank of Maharashtra said it will raise up to Rs 3,000 crore by debt and equity.

Canara Bank stock settled at Rs 104.55 on BSE, down 3.77 per cent from the previous close.