Punjab-based Capital Small Finance Bank raised ₹43 crore from mid-market private equity firm, Amicus Capital, to fund its expansion plans, the company said.
Besides Bengaluru’s Amicus Capital, existing investors such as Pi Ventures also participated in the current round of fund raise. The bank also counts HDFC Life, ICICI Prudential Life and Small Industries Development Bank of India (SIDBI) as its existing investors.
Mint reported first on 11 January that the bank was in talks with PE firms to raise ₹150 crore to grow its loan book and geographic presence.
Founded in 2000 by Sarvjit Singh Samra as a Local Area Bank, Capital SFB was one of the 10 entities to receive Reserve Bank of India’s (RBI’s) in-principle approval to start small finance bank operations in September 2015. It was the first to start operations in April 2016.
“Capital SFB has grown consistently since inception and holds a market leadership position in the state of Punjab. The current round of capital raise will help the bank deepen its penetration in Punjab and expand rapidly into the states of Haryana, NCT (National Capital Territory) Delhi and Rajasthan with a significant focus on MSME (Micro, Small and Medium Enterprises) loans," said Samra.
“We are excited at partnering with Amicus Capital, an institutional investor with significant experience in growing and scaling financial services businesses, as the bank focuses on its next leg of expansion," he added.
Focused on agriculture and MSME sectors, the bank has 134 branches and over 6.25 lakh customers, spread across the states of Punjab, Haryana, NCT Delhi and Union Territory of Chandigarh. As of March 31, its loan book stood at ₹2,600 crores growing at a compounded annual growth rate (CAGR) of 31% between FY16 and FY19. During the period, its deposits have grown from ₹1,810 crores to ₹3,670 crores at a CAGR of 26%.
This is also the third investment made by Amicus Capital’s maiden fund $88 million ( ₹620 crores). It had earlier invested in Delhi based online insurance aggregator RenewBuy.com and in Mumbai-based kitchen appliances and cookware firm Wonderchef.