New Delhi: Public sector lender Syndicate Bank has proposed to tap the capital market with follow on public offer of 8 crore shares during the year to meet Basel II requirement and expansion plans.
The bank would use the proceeds to meet the capital requirements under Basel II guidelines as the bank has the overseas presence. Besides, it would also be utilised for the expansion activity.
According to the RBI’s guideline, banks with overseas branch are expected to comply with Basel II guidelines for operational risk by the end of March 2008.
Price will be determined later subject to necessary approvals from the Government, Reserve Bank and other statutory bodies, the bank said in a filing to the Bombay Stock Exchange.
The stock was trading at Rs81.20, down 0.18% at BSE. Going by the current trading price the bank is likely to raise about Rs650 crore from the market.
Currently, the government holds 66.47% stake in the Manipal-based bank.
Besides, State Bank of India, ICICI Bank, HDFC Bank and Federal Bank has also announced plans to raise capital from the equity offering.
Country’s largest private sector lender ICICI Bank would raise Rs20,000 crore, while HDFC Bank plans to raise Rs4,200 crore from the market.