Public sector lender Bank of India (BoI) is looking to raise funds worth Rs 1,500 crore via qualified institutional placement (QIP) soon, AK Das, MD & CEO, Bank of India said on Tuesday after the company’s quarterly financial results announcement.

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“We recently raised about Rs 1,500 crore of AT1 and there was a lot of interest shown. In the last 12 quarters we have been earning profits and there is good improvement in profitability, so we are planning to hit the market with a QIP issue soon. We are aiming for about Rs 1,500 crore from the QIP issue,” he told CNBC-TV18 in an exclusive interview.

Das further said that if he adds retail earnings of about Rs 3,500 crore, then Bank of India’s capital adequacy ratio will be in excess of 18 percent by March 2023 and that should give good credit appetite to pick up other assets also.

A Qualified Institutional Placement (QIP) is a capital-raising method under which a publicly-traded company can issue equity shares, fully and partially convertible debentures, or any other security convertible into equity shares other than warrants. A QIP, unlike an IPO (initial public offering), is limited to institutions or qualified institutional buyers.

It must be noted that the government has 81.4 percent stake in Bank of India based on the recent shareholding pattern.

Last week, sources told CNBC-TV18 that Union Bank has also appointed investment banks such as ICICI Securities, Yes Securities and JM Finance for Qualified Institutional Bidders (QIB) issue looking to raise Rs 3,000-3,500 crore. As per details available, Union Bank is targeting to launch its QIB issue in Q4 of FY23. Also, roadshows for the QIB issue are likely to begin in the next two weeks.

Earlier in the day, Bank of India reported a 12 percent rise in its profit at Rs 1,151 crore for the third quarter ended December 2022 aided by decline in bad loans. The Mumbai-based bank had posted a net profit of Rs 1,027 crore in the same quarter a year ago.

Total income increased to Rs 14,159.60 crore in the latest December quarter from Rs 11,211.14 crore in the year-ago period, BoI said in a regulatory filing. Net-Interest Income improved by 64 per cent to Rs 5,596 crore against Rs 3,408 crore in Q3FY22, it said.

Shares of Bank of India fell as much as 7 percent post the result announcement, but are now trading 4.7 percent lower at Rs 93.30.

First Published:Jan 17, 2023 3:11 PM IST