Indian Overseas Bank's board approves capital plan for FY23

The board of the PSU bank approved raising of funds worth Rs 2,000 crore by issuing equity shares and bonds in the financial year ending 31 March 2022.

The board of directors has approved the issue of equity shares to a maximum of Rs 1,000 crore through follow on public offer or rights issue, with or without participation from the government of India or issue of equity shares to qualified institutional buyers (QIBs).

Apart from that, the bank may also issue shares to employees or issue shares on a preferential basis to LIC and other insurance companies or mutual funds, or QIBs.

The government-backed lender said it will seek shareholders' approval for raising the equity capital.

The bank's board has also approved raising Tier-II capital by issue of Basel III-compliant Tier-II bonds up to Rs 1,000 crore in one or more tranches, on a private placement basis or by way of a public issue, either domestically or overseas.

Indian Overseas Bank is one of the 12 public sector banks (PSB) in India. As of 31 March 2022, the Government of India held 96.38% in IOB, followed by institutional investors, the public, and others.

The PSU bank's standalone net profit rose 57.9% to Rs 552.38 crore despite a 5.8% fall in total income to Rs 5,718.68 crore in Q4 FY22 over Q4 FY21.

Shares of Indian Overseas Bank were up 0.90% to Rs 16.85 on the BSE.

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