The IPO subscription of Union Bank Ltd will commence tomorrow (Sunday), aiming to raise Tk 4.28 billion from the capital market under the fixed price method.
The initial public offering (IPO) subscription of the fourth generation private commercial bank will be continued until December 30, according to Dhaka Stock Exchange.
Union Bank's IPO will be the largest IPO in the banking sector till date. Among all sectors, it will be the fourth largest IPO after Robi Axiata (Tk 5.23 billion), Grameenphone (Tk 4.86 billion) and MJL Bangladesh (Tk 4.60 billion), according to DSE data.
Each general public, including non-resident Bangladeshi, should maintain a minimum investment of Tk 20,000 at market price in matured listed securities as on December 15 for applying for its IPO.
Minimum and maximum amount allowed for subscription for the general public would be Tk 10,000.
Each eligible investor who intends to submit an application should maintain a minimum investment of Tk 10 million as on December 15 while the amount would have to be Tk 5.0 million for pension funds, recognised provident funds and gratuity funds.
Maximum amount allowed for subscription for an eligible investor is Tk 21.40 million.
Union Bank received the regulatory approval from the Bangladesh Securities and Exchange Commission (BSEC) on September 5 this year to raise Tk 4.28 billion by issuing 428 million ordinary shares at an offer price of Tk 10 each from the capital market under the fixed price method.
The bank will utilise the IPO proceeds for purchasing government securities, investing in 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 pre-IPO paid-up capital is more than Tk 5.58 billion and authorised capital is Tk 10 billion.
Prime Bank Investment and BRAC EPL Investments are jointly working as the issue managers of Union Bank's IPO.
Presently, 32 banks are listed on 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.
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