India-based private sector lender Yes Bank is reportedly planning to raise at least INR80bn ($1bn) through a public offering of shares to boost its capital, Bloomberg has reported.
Yes Bank said that the fresh funding will help the bank raise its Tier-1 core capital ratio to around 10%, from 6.3% as of March 2020.
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The bank said it will commence its fundraising soon and plans to raise a total amount of INR150bn, the report added.
The government-owned State Bank of India (SBI) and private lender HDFC are two of India’s largest banks to back Yes Bank.
The share sale follows the bank’s application to regulators to fast-track its fundraising, after Reserve Bank of India (RBI), the country’s central bank, rescued Yes Bank in March.
Under the rescue plan announced by the Indian government, SBI, HDFC, ICICI Bank, Kotak Mahindra Bank, Bandhan Bank, Federal Bank and IDFC First Bank invested INR100bn into Yes Bank.
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By GlobalDataSBI acquired 48.2% stake in Yes Bank by leading the rescue plan with INR60.5bn capital infusion. Yes Bank can now issue instruments including shares or convertible bonds.
Reports emerged stating that after being bailed out Yes Bank’s share price rose by as much as 73%.
The latest funding plan is separate from Yes Bank’s announcement last week to bag up to INR100bn through a follow-on public offering (FPO).
