Canara Bank gets shareholders approval to raise up to Rs 2,000 cr

The issue proceeds will enable the bank to strengthen its capital adequacy requirements as specified by RBI

PTI July 27, 2016 13:06:25 IST
Canara Bank gets shareholders approval to raise up to Rs 2,000 cr

New Delhi: Canara Bank Wednesday said it has got shareholders' approval to raise capital by up to Rs 2,000 crore.

"The bank has concluded its 14th Annual General Meeting and transacted... raising of capital (up to Rs 2,000 crore by further issue of equity/preference shares or other securities either by way of follow-on public issue, rights issue, private placement, Qualified Institutional placement (QIP), or any other mode," Canara Bank said in a BSE filing.

Canara Bank gets shareholders approval to raise up to Rs 2000 cr

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If further said: "The resolution was passed with requisite majority."

In a separate filing, Canara Bank said RBI has imposed a penalty of Rs 2 crore on it for violation of anti-money laundering norms.

Last month, Canara Bank had said it will seek shareholders' approval in July to raise Rs 2,000 crore to create capital buffer.

"The issue proceeds will enable the bank to strengthen its capital adequacy requirements as specified by RBI from time to time", the bank had said.

The state-owned lender's capital adequacy ratio, as on 31 March, 2016, stood at 11.08 percent, and was well above the 9 percent stipulated by the Reserve Bank.

CAR is a measure of a bank's capital to cushion against or absorb a reasonable amount of losses before they become insolvent and consequently lose depositors' funds. It ensures efficiency and stability of a financial system by lowering the risk of banks becoming insolvent.

Shares of Canara Bank were trading 1.36 percent up at Rs 261.25 on BSE.

Updated Date:

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