Allahabad, UCO Bank get shareholders' nod to raise funds

Shareholders of UCO and Allahabad Bank have approved capital infusion from the government and Life Insurance Corporation (LIC) at the general meeting of the bank in Kolkata.

UCO bank would issue 31.37 million equity shares to LIC for nearly Rs 259 crore at an issue price of Rs 82.49 per equity share. LIC has accorded its in-principle approval for contribution up to five per cent of the pre-issue paid up capital of the bank, said a press statement. At present, LIC holds 9.89 per cent of the bank’s capital at present.

The bank will also issue about 60.61 million equity shares to the government at an issue price of Rs 82.49 per equity share. The government holds 68.13 per cent of the total number of shares of the bank at present. The bank has got shareholders’ approval to raise Rs 500 crore.

Subsequent to the capital contribution from LIC and government, the bank’s Tier-I capital will improve to eight per cent by March 31.

Allahabad Bank plans to issue about 51.98 equity shares of Rs 10 each to the Union government at a premium of Rs 182.94 per share.

The bank will be able to raise close to Rs 1,003 crore through the capital infusion plan. The bank also plans to issue 23.80 million shares of Rs 10 each at a premium of Rs 182.9 per share to LIC, thereby mobilising Rs 460 crore, said a press statement issued by the bank.