RBL Bank gets board nod to raise Rs 1,566 crore via preferential issue

The proposed allottees are: Baring Private Equity-owned fund Mapple II BV, ICICI Prudential Life Insurance Company, CDC Group, Gaja Trustee Company and Gaja Capital.

The board of RBL Bank on Thursday cleared raising Rs 1,566 crore through preference share sale. The bank will allot 8.84 crore shares at a price of Rs 177 a piece to six investors, including Baring Private Equity and ICICI Prudential. Funds will be used for creating a war chest.

The issue price implies around 3% discount to Thursday’s closing price of Rs 182.10 on the BSE. The preferential issue will help the bank improve capital ratios.

After the issue, the capital adequacy ratio of the bank will improve to 18.6%, against 16.14% at the end of the June quarter. Similarly, the common equity tier-I (CET-I) ratio will increase to 17.4%, compared to 15.16% at the end of June 30, 2020.

The proposed allottees are: Baring Private Equity-owned fund Mapple II BV, ICICI Prudential Life Insurance Company, CDC Group, Gaja Trustee Company and Gaja Capital.

After the allotment of shares, Maple II BV will own 9.45% in the company. ICICI Prudential Life Insurance will hold 3.13%, CDC Group 5.55%, Gaja Capital Fund II 1.35% and Gaja Trustee Company will own 0.07% in the lender.

The allotment is subject to shareholder’s approval. The company has called an extraordinary general meeting on September 12 to approve the preferential issue.

The private lender had earlier reported a 47% year-on-year (y-o-y) decline in its net profit to Rs 141 crore for the June quarter due to excess provisions of Rs 460 crore.