Union plans to raise Rs. 1 bn.

Union Bank plans to raise Rs. one billion through a private placement and a rights issue in order to meet Central Bank of Sri Lanka’s capital requirements of Rs. 2.5 billion.

The Bank’s current capital value is Rs. 1.6 billion.

Union Bank which had its E.G.M. on Friday plans to raise the required capital by issuing 32 million shares at Rs. 12.50 a share to a private fund controlled by Shore Capital, U.S.A. an investment fund that targets emerging markets and the balance 44 million shares, also at Rs. 12.50 a share to its existing shareholders through a rights issue.

Its single biggest shareholder of Union Bank is Sampath Bank which has between a 15-20% stake in it.

A number of directors of the Bank’s Board are also its shareholders. Union Bank Board comprises Ajita de Zoysa (Chairman), Alexis Lovell (a fund manager based overseas), Ajith Wijesekera, Jith Warnakulasuriya, Ananda Athukorala, Asoka de Silva, Malik Samarawickrama, Prince Faisal Al Abdullah Al Faisal Al Faud (from the Saudi Royal family), Asoka de Silva, Anil Amarasuriya and Dr. Harsha Cabral (P.C.).  The adviser to its Board is Edgar Gunatunge, a former Sampath Bank chairman.