Central Bank of India plans Rs540-crore preferential issue to LIC
14 Jun 2014
State-owned Central Bank of India (CBI) proposes to sell equity shares to Life Insurance Corporation (LIC) of India on a preferential basis to raise around Rs540 crore.
The bank's board has approved the issue of up to 7,10,75,753 equity shares of the face value of Rs 10 each on a preferential basis to LIC to raise additional capital, Central Bank of India said in a filing with the Bombay Stock Exchange (BSE).
LIC currently holds 7,34,20,914 shares, or 5.44 per cent stake, in Central Bank of India.
Shares of the bank closed at Rs76.45 apiece on the market today. At this rate, the stake proposed to be bought by LIC would be worth Rs543 crore.
The price for preferential allotment may be determined as per SEBI Regulations, it said, adding, an extra-ordinary general meeting of shareholders will be held on 15 July 2014 to pass the resolution.
The government of India (GoI) currently holds 88.63 per cent stake in Central Bank of India.
The bank had reported a 4 per cent decline in net profit to Rs162.44 crore in the fourth quarter ended 31 March 2014, against a profit of Rs169.15 crore in the January-March quarter of 2012-13.
Total income increased to Rs6,961.67 crore from Rs6,403.57 crore.
For 2013-14, the bank made a loss of Rs1,262.84 crore, compared with a profit of Rs1,014.96 crore in the previous financial year, due to higher provisioning.
