Axis Bank advances after raising capital

Axis Bank gained 1.55% to Rs 502.15 at 9:30 IST on BSE after the bank announced that it has successfully issued Rs 3500 crore Basel III compliant additional tier 1 debentures.

The announcement was made after market hours yesterday, 28 June 2017.

Meanwhile, the S&P BSE Sensex was up 156.10 points or 0.51% at 30,979.01.

On the BSE, 26,862 shares were traded on the counter so far as against the average daily volumes of 6.04 lakh shares in the past two weeks. The stock had hit a high of Rs 503.25 and a low of Rs 497 so far during the day.

Axis Bank announced that it has successfully issued Rs 3500 crore Basel III compliant additional tier 1 debentures through private placement to augment the tier 1 capital base. The perpetual debentures with a 5 year call are priced at a fine coupon rate of 8.75%.

The board of directors of the bank had yesterday, 28 June 2017, approved the allotment of 35,000 unsecured subordinated perpetual additional tier 1 Basel III compliant non-convertible debentures of the face value of Rs 10 lakh each for cash at par aggregating to Rs 3500 crore, on a private placement basis.

On 22 June 2017, the bank had said that it proposes to raise funds by issuing unsecured, subordinated, perpetual, additional tier 1, Basel III compliant NCDs of the face value of Rs 10 lakh each for cash at par aggregating to Rs 3500 crore.

Separately, Axis Bank announced before market hours today, 29 June 2017 that the Reserve Bank of India (RBI) issued directions in its communication dated 15 June 2017 advising banks to initiate insolvency resolution process in select accounts under the provisions of the Insolvency and Bankruptcy Code, 2015 (IBC). Axis Bank had exposure on 8 of these accounts.

Total fund based outstanding of the bank on these accounts was Rs 5071 crore. Non-fund based outstanding was Rs 212 crore as on 31 March 2017. Around 80% of the outstanding was secured. Against this outstanding, the provision held was Rs 2497 crore.

Axis Bank's net profit fell 43.1% to Rs 1225.10 crore on 4.3% growth in total income to Rs 14181.31 crore in Q4 March 2017 over Q4 March 2016.

Axis Bank is one of the biggest private sector banks in India.

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