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Union Bank Ltd will make its shares trading debut on Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE) on Wednesday under the settlement category “N”.
The private commercial bank, which received regulatory approval from the Bangladesh Securities and Exchange Commission (BSEC) on September 5, 2021, raised Tk 4.28 billion from the capital market under the fixed price method.
The bank offloaded 428 million ordinary shares at an offer price of Tk 10 each, as per the regulatory approval.
The IPO subscription of the fourth generation private commercial bank was held between December 23 and December 30, 2021.
Each general investor received a minimum of 792 shares of Union Bank under the pro-rata basis while non-resident Bangladeshi investors got 537 shares against the application of Tk 10,000.
The bank will utilise the IPO proceeds for purchasing government securities, investing in the stock market, financing in SME and other projects and IPO expenses.
The bank has reported net asset value (NAV) per share of Tk 16.38 (without revaluation reserve) and earnings per share (EPS) of Tk 1.77 for the year ended on December 31, 2020. The weighted average EPS of five years was Tk 1.82.
The bank’s post-IPO paid-up capital is more than Tk 9.86 billion and authorised capital is Tk 10 billion, while the total number of shares is 98.69 million.
The BSEC also allowed the bank to issue 15 per cent IPO shares to its employees but they would not be able to sell the shares within the first two years of trading.
The Union Bank will not be allowed to declare any dividends, approval and disbursement for its shareholders before being listed on the bourses, according to the regulatory approval.
Prime Bank Investment and BRAC EPL Investments are jointly working as the issue managers of Union Bank’s IPO.
Presently, 32 banks are listed with the DSE.
As per the bank’s draft prospectus, S Alam Group is the owner of the bank, and most of the directors are from the same business group.