IDFC First Bank gets board approval to raise Rs 4,000 cr

The bank said that the amount will be raised in one or more tranches at an appropriate time, by way of issuance of equity shares/Tier 1 Capital.

IDFC First Bank on Friday announced: "with the intent to further strengthening the balance sheet of the Bank and in order to sustain the growth plans of the Bank, the Board, at its meeting held today, has considered and approved the Capital Raise Plan of the Bank for the next one year, for an amount aggregating up to Rs. 4,000 Crore, to be raised in one or more tranches at an appropriate time, by way of issuance of equity shares/ Tier 1 Capital ('Capital Raise')".

In this regard, the board has authorized the "Capital Raise & Corporate Restructuring Committee" of the bank, to decide on various avenues, mode(s) and the timing of the said capital raise, as it may deem fit.

IDFC First Bank was formed by the merger of erstwhile IDFC Bank and Capital First. As on 30 September 2022, the bank has 670 branches and 812 ATMs (including recyclers) across the country. The bank has added 29 branches and 93 ATMs since 31 March 2022.

The private lender reported a net profit of Rs 555.57 crore in Q2 FY23, steeply higher than Rs 151.74 crore recorded in Q2 FY22, driven by strong growth in core operating income. Total Income jumped 33.82% to Rs 6531.03 crore in Q2 September 2022 from Rs 4880.29 crore in the corresponding quarter previous year.

Net Interest Income (NII) grew by 32% year on year (YoY) to Rs 3,002 crore in Q2 FY23 as against Rs 2,272 crore reported in Q2 FY22. Net Interest Margin (NIM) increased to 5.98% in Q2 FY23 compared to 5.83% in Q2 FY22.

Capitalisation is healthy for the bank, as reflected in Tier 1 capital adequacy ratio (CAR) of 13.67% and overall CAR of 15.35% as on 30 September 2022 (14.88% and 16.74%, respectively, as on 31 March 2022).

Shares of IDFC First Bank fell 0.17% to Rs 57.10 on Friday, 4 November 2022.

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