Union Bank Limited (DSE:UNIONBANK) will raise INR 20,000 million equity through a qualified institutional placement or QIP by December that will help lower the government equity share in the bank to 75% as per Sebi requirement. The bank has already raised INR 50,000 million through the same route earlier in August this year. "We hope to raise INR 20,000 million this calendar year.

We are raising capital for meeting Sebi requriement and also growth requirement. "said the bank's managing director & CEO, A Manimekhalai at a media briefing to announce the bank's September quarter results. "With the conclusion of the QIP, the government share holding will come down to 75% from 76.98%".

Ms. Manimekhalai said that the credit growth was subdued in the first quarter and it is expected to pick-up in the December quarter and March quarter. The bank has targeted an advances growth of 10-12% and deposit growth of 8-10% for the current financial year. "With the festive season now underway, we anticipate exceeding our provided guidance" she said.

The bank has already raised INR 50,000 million through QIP in August at an issue price was INR 86.55 per equity share which included a premium of INR 76.55 per equity share. Its Capital risk weighted adequacy ratio is at 16.69%.