RBL Bank raises Rs 1,500 crore via preferential issue

Private sector lender RBL Bank has raised more than Rs 1500 crore ($200 million) through a preferential share offering.
RBL bank issued 8.84 crore shares at Rs 177 per share to five investors. Baring PE, ICICI Pru Life Insurance and CDC Group are some of the investors. The shares have been allotted at a discount of 4.19% to the previous close.
The funding will help the lender increase its capital adequacy ratio.
Thanks to the issue, the CAR of the lender will increase to 18.6% with common equity tier 1 increasing to 17.4% based on levels at the end of June.

Post the allotment of shares, Maple II BV (a unit of Baring PE) will own 9.45% in the company. Similarly, ICICI Pru Life Insurance will hold 3.13%, CDC Group 5.55%, Gaja Capital Fund Fund II 1.35% and Gaja Trustee Company 0.07% in RBL Bank.
The allotment is subject to shareholder approval. For that the company also called for an extraordinary general meeting (EGM) on September 12.
This latest exercise comes after the bank mobilised Rs 2,700 crore  through a combination of preferential issue and QIP process in December last year.

The transaction saw participation from investors that included Bajaj Finance, Bajaj Allianz, Eastbridge, Ward Ferry and Falcon Edge.
In the Q1, excess provisions of Rs 460 crore led small-sized private sector lender to report a 47% decline in net profit of Rs 141 crore.
Since March, a clutch of banks have raised funds through QIP and other modes as they beef up capital in anticipation of a possible rise in bad loans. These include Kotak Mahindra Bank, ICICI Bank, Axis Bank and HDFC Bank.

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