The board of Union Bank of India has approved the raising of up to Rs 5,000 crore via qualified institutional placement (QIP), and has set a floor price of Rs 91.10 per share, a regulatory filing said on August 21.
The decision was taken by Union Bank's committee of directors for raising capital funds, which met earlier in the day.
The committee "approved the opening of the issue today, i.e. August 21, 2023", and "approved the floor Price of Rs 91.10 per equity share", the exchange filing stated.
The panel gave its nod to the raising of funds for an amount "not exceeding Rs 5,000 crore through issue of equity shares through qualified institutional placement subject to the requisite regulatory /statutory approvals", the state-run lender added.
In another exchange filing, Union Bank noted that the committee will meet again on August 24 to "consider and approve the issue price, including a discount, if any thereto" for the equity shares to be allotted to qualified institutional buyers, pursuant to the issue.
The announcement comes a month after Union Bank reported a 107 percent on-year rise in its standalone net profit to Rs 3,236.44 crore in the first quarter of the current financial year. The bank's net interest income of the lender increased 16.59 percent on-year to Rs 8,840 crore.
The lender had also reported an improvement in the asset quality, with gross non-performing asset (NPA) ratio improving by 288 bps and net NPA decreasing by 173 bps compared to the year-ago period.
In the trading session on August 21, Union Bank's scrip settled at Rs 91.80 on the BSE, which was 2.81 percent lower as against the previous day's close.
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