Unicorn Slice eyes $100 million to fuel its banking dreams
Slice is in talks for a $100 million equity funding round, according to three people in the know. Early conversations have happened with existing backers, but the leadership is looking to get an external investor to lead the round.
The talks are still at an early stage and, given the overall funding winter, might take a few months to close, the people said.
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Offering CollegeCourseWebsiteIndian School of BusinessISB Product ManagementVisitIndian School of BusinessISB Digital TransformationVisitMITMIT Technology Leadership and InnovationVisitThe funding will be made in the new entity to be formed by the merger of Slice and North East Small Finance Bank. Under the deal, Slice’s non-banking finance company is merging with the small finance bank. The other entities of Slice will cease to operate, the people said.
“The funding is mainly required from the perspective of maintaining the newly formed bank’s capital adequacy ratio. Currently the merged entity should have around 35%, which is at a comfortable stage, but it cannot go below 15% as per regulatory mandate,” said one of the people. “Once the merger is completed, Slice will have to infuse additional capital into the bank.”
In its FY23 filings, the small finance bank had reported its tier 1 capital ratio at 2.75%, well below the regulatory threshold of 15%. Its gross bad assets or loans that had not been repaid on time shot up to 18.2% last fiscal year compared with 10.9% the previous year.
The people spoke on the condition of anonymity. The company did not respond to detailed queries from ET.
Slice is backed by the likes of Tiger Global, Gunosy Capital and Axis Bank. Tiger Global, an aggressive investor in
