Private sector lender AU Small Finance Bank (SFB) on August 3 opened its qualified institutional placement (QIP) to raise up to Rs 2,000 crore and set the floor price of the issue at Rs 590.84 per equity share.

The company is looking to mop up Rs 1,600 crore as the base deal size, with an option to increase the total funds raised by another Rs 400 crore.

Jaipur-based AU Small Finance Bank stated, "The Capital Raising Committee of the board has, at its meeting held today passed a resolution for the following: (a) Authorised the opening of the Issue today, i.e. August 03, 2022. (b) Noted the floor price for the issue; and (c) Approved and adopted the preliminary placement document dated August 03, 2022."

"The bank may offer a discount of not more than 5% on the floor price so calculated for the issue," the lender said.

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"A meeting of the Capital Raising Committee of the bank is scheduled to be held on August 8, 2022, inter alia, to consider and determine the issue price of equity shares," the bank added.

Back in July, the bank's board had approved a proposal for a Rs 3,000-crore equity fundraise. Further, the board also approved borrowing or raising of funds for an amount not exceeding Rs 6,000 crore in one or more tranches, by the issue of debt instruments, including but not limited to bonds and non-convertible debentures.

AU Small Finance Bank reported a 32 percent year-on-year increase in its Q1 net profit at Rs 268 crore. It had reported a net profit of Rs 203 crore in the year-ago quarter.

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The bank remains well capitalised with a total CRAR (capital to risk weighted assets ratio) at 19.4 percent against the minimum requirement of 15 percent. By adding the interim profits, the CRAR will be 20 percent. Its Tier I capital ratio of 18.4 percent is against the minimum requirement of 7.5 percent. Adding the interim profits, the Tier-I capital adequacy would be 19.1 percent.

(Edited by : Shoma Bhattacharjee)

First Published:Aug 3, 2022 7:05 PM IST