Federal Bank proposes to raise up to Rs12K cr through equity & debt

While equity target is Rs4000cr, debt could go up to Rs8000cr

KOCHI: The director board of Federal Bank Ltd, the largest Kerala-based bank with an asset base of Rs1,80,638 crore (Rs1.81 trillion)  on June 19 proposed to  raise up to an aggregate amount of Rs12,000 crore through the issue of fresh equity capital and debt instruments.

The bank is also planning to amend the Memorandum of Association (MoA) of the bank to increase the authorised capital from Rs500 crore to Rs800 crore.

The bank informed that all these proposals will be ratified at the 89th annual general meeting (AGM) of the bank to be held on Thursday, July 16, 2020 at 11 am by way of Video Conference ( VC) or Other Audio Visual Means (OVAM).

The bank has fixed Friday, July 10, 2020 as the cut-off date for the purpose of remote e-voting/e-voting at the AGM.

While up to Rs4000 crore or its equivalent amount in such foreign currencies inclusive of any premium has been earmarked to be raised in equity capital in one or more tranches, the bank plans to raise up to an amount of Rs8000 crore through debt instruments.

The bank said the equity capital could be raised through the choice of routes from rights issue, private placement, Qualified Institutions Placement (QIP), preferential issue, Further Public Offer (FPO), Global Depository Receipts (GDR), American Depository Receipts (ADR), Foreign Currency Convertible Bonds (FCCB) or through any other permissible mode or a combination thereof, as may be considered appropriate, subject to applicable regulatory/statutory approvals and requirements.

Likewise, the bank proposes to do the borrowing/raising funds in Indian currency/in equivalent foreign currency by way of issue of debt instruments including but not limited to Additional Tier I bonds (AT1 bonds), Tier II bonds, Long Term Bonds (Infrastructure & Affordable Housing), Masala Bonds, Green bonds, non-convertible debentures or such other debt securities.

The bank also added that the borrowing could be done in domestic market and/or overseas market, under one or more shelf disclosure documents and/or under one or more letter of offers, and in one or more tranches, on a private placement basis within the overall borrowing limits of the bank.

 

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