Canara Bank to raise Rs 3000 crore via QIP issue in Q2

Board has already approved the placement and the Bank would take approval from the public shareholders today

Bangalore-based public sector lender Canara Bank today said it would raise Rs 3,000 crore via qualified institutional placement (QIP) issue to augment its Tier-I capital. The Bank's board has already approved the placement and the Bank would take approval from the public shareholders, which is slated to take place, here today this evening.

"We want to raise Rs 3,000 crore to shore up our Capital under the Tier-I. We would be approaching the investors sometime in the second quarter itself after the AGM approval later today. We have adequate headroom available to raise capital to support business growth momentum," said R K Dubey, Chairman and Managing Director, Canara Bank.

Capital Adequacy Ratio as per Basel-III norms stood at 10.23% (as against mandatory requirement of 9%.) CET ratio at 7.12% (against mandatory requirement of 5.5%) and Tier-I ratio of 7.39% (as against mandatory requirement of 7%).

The Bank has set a business target of Rs 8 lakh crore during 2014-15. It plans to take the number of branches to 6,000 and ATMs to 10,000 by March 2015. Its thrust for the current year is on retail business - CASA, retail deposits, retail credit, recovery, fee income and asset quality. It also plans to have gross NPA of around 2% and Net NPA of around 1.5% by March 2015.