PNB Housing Finance fundraising
A long-pending announcement of fundraising by a non-bank lender is finally made. The announcement was of raising Rs.1800 crore through a preferential or rights issue in November 2020.
The meeting is on May 31, where the PNB Housing Board will meet to consider the fundraiser. The plan was stopped in November 2020 due to the disapproval of the request of the parent Punjab National Bank by the Reserve Bank of India.
The MD and CEO of PNB Housing Finance said that they have been waiting to do the fundraiser with the help of PNB, and since then, Rs. 600 crore was earmarked. But as the permission was not granted, the plan was postponed. Now, they are looking into all the available options to raise funds.
On the other hand, the non-banker disclosed the new agreement that they have made with PNB, which gives the parent company the right to withdraw themselves from the mortgage lender. If the shareholding of PNB in PNB Housing finance falls below 30%, then the new agreement will be applicable. Currently, the shareholdings of PNB in the finance company is 33%. They believe that the new deal was made to dilute PNB’s shareholding raised by the PNB housing finance.
The old brand agreement was dated December 7, 2009, and it will continue to be in place if the shareholdings of PNB are more than 30%. If it falls below 30%, then the new agreement, which was signed on May 24, will replace the old one.
The PNB Housing Finance registered a net profit of Rupees one hundred twenty-seven crores during the March quarter against a loss of Rupees Two hundred forty-two crores a year ago in the same period.