Central Bank of India will seek shareholders’ approval in its ensuing annual general meeting (AGM) next month to set off accumulated loss of over Rs 18,724 crore from the share premium account of the bank.
The next AGM for the state-owned bank is scheduled for August 10, 2021 through audio/video means.
The bank said it would seek shareholders’ consent to set off the accumulated losses of Rs 18,724.22 crore as of March 31, 2021 by utilising the balance standing to the credit of share premium account of the bank as on date to set off and take the same into account during the current financial year 2021-22.
“The bank is of the view that this is the most practical and economically efficient option available to the bank in the present scenario to present a true and fair view of the financial position of the bank,” it said in a regulatory filing.
Central Bank of India said the setting off of accumulated loss would benefit the bank’s shareholders as their holding will yield better value. It will also enable the bank to explore opportunities to the benefit of the shareholders of the bank.
It will also put the bank in a better position to achieve its turnaround plans in time-bound manner, the lender said.
Share premium balance is a reserve that can only be used for the defined purposes. A share premium account reflects the difference between the face value of shares and the subscription price of the shares.