 "Federal Bank net profit up 18%")
Federal Bank’s board will on July 21 consider fundraising and share allotment plans to the International Finance Corporation (IFC). The fundraising will be through the issue of preference shares to qualified institutional buyers (QIB).
The bank said in an exchange filing that it plans to issue 72.6 million preference shares to the International Finance Corporation, IFC Financial Institutions Growth Fund, and IFC Emerging Asia Fund.
"The minimum subscription price per share for a preferential issue to QIB shall not exceed Rs 131.91 per equity share," the filing said.
The board will also consider borrowing or raising of funds in Indian rupee or any permitted foreign currency by way of issue debt instruments including but not limited to additional Tier I bonds (AT1 bonds), Tier II bonds, long-term bonds (infrastructure and affordable housing), masala bonds, and bonds issued for environmental, social, governance funding (ESG bonds) in domestic market or overseas market on a private placement basis within the overall borrowing limits of the bank.
The bank is reportedly looking to raise around Rs 4,000 crore in 2023-24. “We are evaluating. We have a shareholder approval to go up to Rs 4,000 crore in the form of QIP or a preference. That is our permissible limit,” said Shyam Srinivasan, managing director and chief executive officer of Federal Bank, last week.
The company is reconsidering the option of initial public offering in its non-banking financial company Fedbank Financial Services Ltd (Fedfina). “The company had filed the DRHP (draft red herring prospectus) last year but the markets were not ideal that time. The company is reconsidering options of reconsidering raising the capital this year. We as a bank hold 74 per cent of the company. We will continue to be a majority shareholder,” he said.
