Will raise INR 15-20 bln via QIP soon to lower govt stake by 2-3%
UCO Bk MD
This story was originally published at 20:40 IST on 19 October 2024
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--UCO Bank MD: Will begin capital raising via QIP, roadshow to start soon
--UCO Bank MD: Will do QIP worth INR 15-20 bln initially
--UCO Bank MD: See govt's stake going down by 2-3% post phase I QIP
NEW DELHI – With its quarterly earnings out Saturday, UCO Bank Ltd. will soon hold roadshows to raise INR 15-20 billion to lower the government's stake in the public sector bank by 2-3%, Managing Director and Chief Executive Officer Ashwani Kumar said. "We will begin our capital raising plan via the qualified institutional placement route soon," he said, adding this will be the first phase of the plan.
UCO Bank had announced plans to issue up to 4 billion shares, with a face value of INR 10 each, in the current financial year to help the public sector bank meet the mandated minimum public shareholding level. The Centre currently owns 95.39% stake in UCO Bank.
The finance ministry has asked five public sector banks to increase the minimum public shareholding to 25% by Aug. 1, 2026. This is in line with the Securities Contract (Regulation) Rules issued by the Securities and Exchange Board of India, which mandates all listed companies, including the public sector ones, to have a minimum public shareholding of 25%.
Kumar said the lender was adequately capitalised and the only reason the bank will raise funds going forward will be to meet the norms. Considering raising INR 15-20 billion will only help lower the government's stake in UCO Bank by 2-3%, it will have to carry out the capital raising plan in far excess of what they have announced so far. Shares of UCO Bank Friday ended at INR 45.68 on the National Stock Exchange, up 1.3% from the previous close. End
Reported by Priyasmita Dutta
Edited by Vandana Hingorani
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