Punjab & Sind Bank (PSB) is all set to issue shares upto 5% of the paid-up capital on preferential basis to Life Insurance Corporation (LIC). The bank proposes to issue 11.2 million fresh shares at a rate to be decided in terms of SEBI (Issue of Capital and Disclosure Requirements) Regulations, subject to approval from the government of India and other regulatory compliances.
LIC will have to pay about Rs 95 crore to the bank as per existing share price of PSB. The additional capital will further strengthen Capital to Risk-weighted Assets Ratio (CRAR) of the bank and support its business growth.
Currently, the government holds 82.07% in the bank. After share transaction in favour of LIC, government's stake in the bank would come down.
Earlier, the bank had raised Rs 470.82 crore in 2010 through an IPO, which was subscribed 50.75 times.
