Canara Bank to raise Rs 1,128 cr via rights issue

State-owned Canara Bank today said it plans to raise up to Rs 1,128 crore through rights issue to fund business growth.
Besides, the board of the bank also approved raising of USD 500 million from overseas market by selling bonds.
The board of the bank today gave its approval to raise additional capital of an amount not exceeding Rs 1,128 crore including premium by way of rights issue with the Government of India contribution of Rs 748 crore and Rs 380 crore from the public shareholders, Canara Bank said in a regulatory filing on stock exchanges.
It also cleared the proposal for constituting rights issue committee of the board of directors to decide and permit on the terms, timing, pricing and other modalities of the rights issue.

The government currently holds 66.30 per cent stake in the bank. In case, the government does not want to dilute its stake it has to subscribe rights issue equivalent to its shareholding. Rights issue are offered by the existing shareholders.
Besides, it said, the board also allowed the bank to issue senior unsecured bonds in foreign currency in the range of USD 500 milion in the international market under the USD 2 billion Medium Term Note (MTN) programme of the bank for the purpose of providing funds to the overseas branches of the bank.
The bank has so far raised USD 1,100 million under the programme.