AU bank raises ₹2,500 cr via QIP, bonds

Jaipur: AU Small Finance bank on Wednesday announced that it raised Rs 2,500 crore comprising tier-I capital of Rs 2000 crore and Rs 500 crore tier-II capital. The latest fund raising takes the bank’s overall capital adequacy ratio from 19.4% to 25.7%.
Sanjay Agarwal, MD and CEO of the bank said, “The fresh capital would be used to support the bank’s growth plans over the medium term and will help maintain sufficient headroom over and above the regulatory capital adequacy requirements.”
The QIP issue of Rs 2,000 crore was launched at a price band of Rs 570-590 a share and witnessed a strong demand from both the foreign and domestic institutional investors. The QIP issue was oversubscribed four times with bids crossing $1 billion.
This is the third and the largest private equity capital raise by the bank since it was converted into a Small Finance Bank in April 2017. It had raised Rs 1,000 crore from Temasek in 2018 and 2019 via preferential issuance. The bank has raised Rs 625 crore through first QIP in 2021.
“Our objective remains to build a best-in-class tech-led retail bank in India with a very sustainable business model and the fresh capital will significantly help us in that journey,” added Agarwal.