Punjab & Sind Bank will convene an extraordinary general meeting on March 25 to seek shareholders' approval for ₹5,000 crore equity infusion by the government in exchange for shares.
The bank will issue over 335 crore shares at ₹16.41 apiece to the government in lieu of the capital infusion.
With the object to strengthen the capital adequacy of the Public Sector Banks (PSBs), the government has decided to infuse capital to the extent of ₹5,500 crore in the bank. The capital infusion will be by way of creation, issue and allotment of equity shares in favour of government on preferential allotment basis, Punjab & Sind Bank said in a regulatory filing on Tuesday.
"Shareholder approval is, therefore, sought for the issue of 3,351,614,868 equity shares of ₹10 each fully paid for cash at premium of ₹6.41 per share... up to the amount of ₹5,500 crore only, through preferential issue of equity shares in the favour of government," it said.
The entire preferential issue will be subscribed by the government.
The government's shareholding in the bank stands at 83.06 per cent as on date and will increase to 97.07 per cent post-issue of the preference shares.
The Extraordinary General Meeting (EGM) will be conducted through video conferencing on March 25.
Shares of the lender declined over 1% to close at ₹18 apiece on the BSE.
This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.
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