The decision was taken by the board of directors at its meeting held on June 16, 2021, the bank said.
The board also decided to raise up to Rs 4,000 crore by issuing equity shares or other instruments through various modes and Rs 8,000 crore by issuance of debt securities in Indian or foreign currency.
Equity shares up to 104,846,394 at a price of Rs 87.39 each aggregating to approximately Rs 916.25 crore are proposed to be allotted to IFC, IFC Financial Institutions Growth Fund, LP (FIG) and IFC Emerging Asia Fund, LP (EAF), Federal Bank said in a regulatory filing.
Under this, the bank has proposed to issue 31,453,918 shares to IFC; 36,696,238 shares each to FIG and EAF. “There are three investors who are being issued equity shares pursuant to preferential allotment,” Federal Bank said.
Further, the bank said it will raise fund by way of issuance of equity capital up to an aggregate amount of Rs 4,000 crore or its equivalent amount in foreign currencies in one or more tranches through various modes including rights issue, private placement, qualified institutions placement, preferential issue or follow on public offer, GDR, ADR or foreign currency convertible bonds.
Also, the board accorded its approval to raise up to Rs 8,000 crore by issuing debt instruments through various modes including additional tier 1 bonds, tier 2 bonds, long term bonds, masala bonds, green bonds, NCDs.
These instruments are intended to be issued in the domestic or overseas market in one or more tranches on a private placement basis, the bank said.
The fund raise approval decisions by the board of the bank are subject to approval of shareholders of the bank in its forthcoming annual general meeting (AGM).
Bank’s ensuing AGM is scheduled on July 9, 2021 by way of video conference or other such means. Federal Bank stock closed 1.22 per cent down at Rs 84.95 apiece on BSE.
