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Thursday, January 20, 2011

Union Bank to announce IPO in Feb to raise Rs. 1.1bn

*Rights issue 4 times oversubscribed, private placement 3 times oversubscribed

*Asset base Rs. 2.5 trillion, deposit base Rs. 1.85 trillion

Following a highly successful Rights Issue and a Private Placement, Union Bank of Colombo Limited will announce their IPO to raise 1.1 billion in February this year subject to regulatory approvals. The Bank’s recently announced Rights Issue was oversubscribed by 4 times while the Private Placement was oversubscribed by 3 times, reaching record levels of investor confidence. The Rights Issue, Private Placement and the IPO were launched in an innovative, three tiered process that gave the bank a unique leverage in building investor interest. A statement issued by the bank said: Widely seen as the last investment opportunity currently available in the banking sector, market sources confirm that Union Bank’s IPO has attracted much interest both locally and overseas. Anil Amarasuriya Director / CEO of Union Bank said that a novel method of combined book building and a tender process was adopted in the Private Placement, ensuring wider scope for investor confidence.

The banking sector is considered a key growth area in the Sri Lankan economy and consists of licensed commercial banks and licensed specialized banks. With a total asset base of Rs. 2.50 trillion and total deposits amounting to Rs. 1.85 trillion in 2009 alone, the banking industry is expected to lead the economic growth at a national level and build investor confidence in the country’s economy, ready to surge forward in the post-war recovery phase.

The Bank celebrates its 15th year of operations. "We hope to make this anniversary year a special one aimed at making great strides in the banking world," adds Amarasuriya who pointed out that in keeping with economic growth earmarked for small and medium enterprises, Union Bank as always, will be offering innovative services and products targeted to suit the needs of the SME sector.

Union Bank branch network consists of 21 branches island-wide and is considering rapid expansion and growth with up to 10 new branches expected to open in the coming months.

source - www.island.lk