IOB planning to raise funds by rights issue

Indian Overseas Bank (IOB) is planning to raise funds by way of rights issue. The bank informed the BSE that the board at its meeting held on Saturday decided that they will be going for a rights issue of 20 crore equity shares of face value of Rs 10 each at a premium to be decided based on the market conditions.

The premium will be decided at a future period not exceeding five years from date of issue by way of private placement. The decisions of the board are subject to prior clearance from government, Reserve Bank of India (RBI) and other regulatory authorities.

The funds raised will form a part of the tier-1 capital of the bank. As on September 30, the tier-1 capital of the bank stood at 7.63%.