IOB said that with a view to comply with Basel III requirements relating to capital adequacy, there is an ever increasing need to raise capital.
India: State owned Indian Overseas Bank (IOB) today said it will raise Rs 200 crore by issuing over eight crore shares on preferential basis to LIC to meet the Basel III capital requirement. “…To create, offer, issue and allot up to 8,62,99,771 equity shares for cash at an issue price of Rs 23.18 per equity share aggregating up to Rs 200,04,28,692 on preferential basis to Life Insurance Corporation of India (LIC) or its various schemes,” it said in a BSE filing.
IOB said that with a view to comply with Basel III requirements relating to capital adequacy, there is an ever increasing need to raise capital. “The capital raised would be utilised to shore up the capital adequacy of the Bank and to fund the general business needs of the Bank,” it said in the filing. LIC shareholding in the Bank will, subsequent to the allotment, be raised to 14.50 per cent from 10.21 per cent as of now. As a consequence, Government shareholding in the Bank will come down to 77.32 per cent from 81.19 per cent. Shares of IOB closed 4.25 per cent up at Rs 27 a piece om BSE.
Indian Overseas Bank to issue Rs 200 cr shares to LIC