IOB to raise funds through rights issue

IOB to raise funds through rights issue New Delhi: State-owned Indian Overseas Bank (IOB) on Monday said the board has approved raising of funds through a rights issue.

The board of the bank at its meeting held on December 29, approved a rights issue of 20 crore equity shares of face value of Rs 10 each at a premium to be decided based on the market conditions, IOB said in a filing on the BSE.

At today's closing price, the bank will be able to raise about Rs 1,713 crore from the market.

Shares of the bank closed at Rs 85.65 per unit, up 0.59 percent on the BSE.

Rights issue is offered to the existing shareholders of the bank. Government of India holds 69.62 percent stake in the Chennai-based bank.

The board in principle has also approved issue of "20 crore fully convertible preference shares of face value of Rs 10 each at par to be converted into equity shares of Rs 10 face value at premium (to be decided at the time of issue) at a future period not exceeding five years from date of issue by way of private placement," it said.

This is enabling provision for raising the fund to enhance its capital base.

Meanwhile, another public sector lender Syndicate Bank said it has raised Rs 1,000 crore through bonds.

The funds were raised by issue of unsecured, non-convertible lower Tier II bonds, Syndicate Bank said in a separate filing on the BSE.

The bond was priced at 9 percent payable annually, it added.

Besides, Bank of Maharashtra has raised Rs 1,000 crore by issue of lower Tier II bonds.

PTI