Canara Bank to sell nearly 9 per cent stake in CARE for Rs 393 crore

Government owned Canara Bank will be selling nearly 9 per cent of its shares in the credit rating company CARE for a humongous sum of over Rs 393 crore.
 
With a floor price of Rs 1,500 per share, the bank has buckled up to sell over 26 lakh of its total paid up equity share capital, that comprise 8.90 per cent of equity shares of the company.
 
The bank’s board had also approved the plans of raising capital worth Rs 6,300 crore, including equity capital of up to Rs 3,500 earlier in the month.  
 
On the performance front, the state-run bank posted a profit of Rs 1,122 crore in FY17, compared to a loss of Rs 2,813 crore in the previous fiscal. While the net NP ratio of the bank was considerably high at the end of the fourth quarter of FY17 at 6.33 per cent, it decreased slightly from a 6.72 per cent in the third quarter. The capital adequacy ratio of the bank as on March 31, 2017, stood at 12.86 per cent, higher than the previous year’s 11.08 per cent.  
 
According to market reports, Canara Bank may lead the next round of PSB consolidations with the acquisition of smaller banks that include Dena Bank, Vijaya Bank, UCO Bank, Union Bank of India and United Bank of India.
         
At the time of writing this report, the BSE Bankex index stood at 26747.73, down by 0.21 per cent, trading flat in line with the BSE Sensex at 31,217.77 level, down by 0.25 per cent. However, Canara Bank was trading up by 1.47 per cent at Rs 357.75 on the BSE. The top gainer of the index was PNB Bank trading at Rs 146.50, up by 1.81 per cent.