Canara Bank clocks 10.5 per cent jump in Q1 net profit at Rs 3,905 crore
The bank’s net interest income (NII) during the first quarter increased 6 per cent to Rs 9,166 crore from Rs 8,666 crore in the same period last year.
State-run Canara Bank is planning to raise up to 5,000 crore equity capital via various modes including rights issue, qualified institutional placement among other available options in the current fiscal year to boost its capital adequacy ratio in view of expansion plans.
In this regard, the lender will seek its shareholders’ approval, in its upcoming Annual General Meeting on August 10.
The scheduled AGM meeting will be held through an audio/visual means in view of the coronavirus pandemic.
Advertisement
In its annual report for the year 2019-20, the bank said that the current equity capital of the bank is Rs 1,030.23 crore and the Capital Adequacy Ratio of the bank as on March 31, is 13.65 per cent, which is well above the 10.875 per cent stipulated by the Reserve Bank of India.
However, “in view of certain expansion plans of the bank, the implementation of BASEL III norms, and consequent capital charge, there is a need to increase the capital to further strengthen the Capital Adequacy Ratio,” it said.
The Bengaluru-headquartered lender, which amalgamated Syndicate Bank into itself with effect from April 1, 2020, has ₹1,030.23 crore as equity capital currently and it’s capital adequacy ratio stood at 13.65 per cent as on March 31, 2020, well above the regulatory requirement of 10.875 per cent.
“In order to shore the Bank’s Tier I capital, the Board of Directors of the Bank have decided to raise Capital to the extent of Rs 5,000 crores (including premium) through various modes including follow-on issue, right issue, preferential Issue to government and financial institutions, qualified institutional placement and other permitted mode of raising capital,” it said.
Several banks, both private and public, are looking at raising funds of late.
Advertisement
