The Board of Directors meeting of Canara Bank held on July 10, 2020, had approved to raise up to Rs 8,000 crore in the current financial year, through equity and debt which will result in strengthening its balance sheet.
It has reported a net loss of Rs 3,259.33 crore for the fourth quarter ended March 2020 and had also registered a net loss of Rs 551.53 crore during the January-March quarter in 2019. The bank has raised an income of Rs 14,222.39 crore in the January-March quarter this year, compared with Rs 14,000.43 crore in the year-ago period and had a net loss of Rs 2,235.72 crore in the financial year 2019-20.
The equity share capital amounting up to Rs 5,000 crore is raised through qualified institutional placements (QIP), rights issue, employee stock purchase scheme (ESPS), private placement, preferential allotment, and any other approved means subject to market conditions and necessary approvals during the financial year 2020-21. The board has also decided to raise capital through additional Tier I Basel III compliant bonds to the extent of Rs 3,000 crore during FY21.
Due to the lockdown, the repayment ability of borrowers had been affected and both the private and public banks, are raising capital ensuring that they are sufficiently capitalised. SBI, the country’s largest lender is planning to raise a whopping Rs 20,000 crore equity capital and HDFC Bank to raise up to Rs 50,000 crore in this fiscal year by issuing various debt securities. Axis Bank is planning to raise up to Rs 15,000 crore by issuing equity share and Rs 35,000 crore through debt. ICICI has already raised Rs 2,250 crore, by selling stakes in its subsidiary firms and targeting to raise Rs 15,000 crore. Federal Bank is raising up to Rs 12,000 crore, by targeting the majority from borrowing instruments. Pune-based Bank of Maharashtra will raise up to Rs 3,000 crore by equity and debt.

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