Indian Bank gets approval to issue preferential shares

Indian Bank has got its shareholders' approval for allotment of 15.4 million equity shares of Rs 10 face value at an issue price of Rs 181.31 a share to the Government of India on preferential basis.

The bank secured shareholders' approval at an extraordinary general meeting here on Monday.

The issue is pursuant to the Centre's decision to infuse capital of Rs 280 crore in the bank by way of preferential allotment of equity in its favour.

Consequently, the holding of the government will increase to 394.3 million equity shares, representing 82.10 per cent of the bank's paid-up capital against the current level of 81.51 per cent.

"The Government of India has now infused capital funds as a reward to the bank for its efficiency to enable the bank to further strengthen its position," Indian Bank stated.

The government has considered the weighted average return on assets for the past three years and return on equity for the past financial year as efficiency parameters for infusion of capital funds in during the current financial year, the bank said.