Bank of India plans share sale to meet Sebi's minimum public holding norms

economictimes.indiatimes.com:

Bank of India is exploring the possibility of share sale to investors over the next one year to meet the minimum public holding requirement of 25 per cent. Currently, Government of India holds 81.41 per cent stake in the Mumbai-based bank. «We are exploring options to meet Sebi's minimum public holding requirement.

However, the decision to sell shares would depend on market conditions,» Bank of India Managing Director Rajneesh Karnatak told PTI. Public sector banks have time till August 2024 for meeting the Securities and Exchange Board of India (Sebi) requirement, he said. Post share-sale, depending on the quantum, the holding of Government of India would come down below 75 per cent.

With regard to the bank's growth, he said, credit growth is expected to be 11-12 per cent during current financial year helped by retail, MSME and agriculture loans. As far as the deposit is concerned, he said, «we hope to grow the liability side by 10 per cent during current financial year.» Asked about the resource mobilisation plan of the bank, he said, Capital Adequacy Ratio of the bank stood at 16.28 per cent in March 2023 and this should be enough to take care of loan growth during the year. However, the board has given its approval to raise capital aggregating up to Rs 6,500 crore in FY24 through bonds.

As per the board approval, the bank can raise up to Rs 4,500 crore from follow-on public offer/ qualified institutional placement/rights issue/preferential issue and/or Basel III compliant additional tier-1 (AT-1) bonds while remaining Rs 2,000 crore via Basel III compliant Tier-2 bonds in one or more tranches. It will be done when the need arises and market conditions are conducive, he added. Karnatak while addressing a town hall