Canara Bank raises Rs 500 crore

Canara Bank said on Wednesday it has raised Rs 500 crore by allotting 18.25 million equity shares on preferential basis to the government of India, the public sector lender’s principal shareholder.

The shares had a face value of Rs 10 each with a premium of Rs 273.84 per share, determined in accordance with the Securities and Exchange Board of India’s Issue of Capital Disclosure Requirements) norms.

The bank will use the funds to strengthen its capital base and fund its general business activities, said a Canara Bank official.

With this preferential allotment, the Centre’s shareholding has risen from 67.72 per cent to 69 per cent.

Canara Bank’s capital adequacy ratio stood at 10.62 per cent as of September 2013. The tier-I capital is 8.52 per cent and tier-II capital is 2.10 per cent.

The bank’s shareholders had approved the preferential issue at an extraordinary general meeting on December 30, 2013.