Union Bank of India, a state-owned financial institution, announced that its board has approved a proposal to raise Rs 10,000 crore to support its business growth. This plan includes raising Rs 6,000 crore through a share sale.
The board approved the raising of equity capital not exceeding Rs 6,000 crore in tranches through various methods, such as a public issue, further public offer, rights issue, or Qualified Institutional Placement (QIP), according to a regulatory filing by Union Bank of India. This capital-raising effort is subject to the approval of the government, other regulatory authorities, and shareholders.
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Additionally, the board has approved the issuance of Basel III compliant Additional Tier 1 (AT1) Bonds up to Rs 2,000 crore and Tier 2 Bonds up to Rs 2,000 crore. This includes the option to issue foreign currency-denominated AT1 and Tier 2 Bonds, all within the overall limit of Rs 10,000 crore.
This move by Union Bank of India aims to bolster its capital reserves, enhancing its ability to meet increasing loan demands and support business expansion.
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