Union Bank of India shares gain over 3 pc on fundraising plans

Shares of Union Bank of India gained over 3 per cent in early trade on Friday after the company said it will seek shareholders' approval for raising up to Rs 6,800 crore equity capital.

Shares of Union Bank of India gained over 3 per cent in early trade on Friday after the company said it will seek shareholders' approval for raising up to Rs 6,800 crore equity capital. The stock rose by 3.23 per cent to Rs 31.95 on both BSE and NSE.

The extraordinary general meeting (EGM) will be held on December 30, 2020 through video conferencing or other audio visual means to obtain shareholders' approval for raising of equity capital up to Rs 6,800 crore during the FY2020-21, Union Bank of India (UBI) said in a regulatory filing. The fundraising will be through various modes such as public issue, rights issue, or private placement including Qualified Institutions Placement or preferential allotment to the government, the filing added.

"In order to meet the minimum capital and leverage ratio requirements under the Basel III guidelines for expansion of business assets and based on the estimated growth, your directors have decided to raise equity share capital up to Rs 6,800 crore," UBI said. The enhanced capital will be utilized for general business purposes of the bank, it added.

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