Private sector lender Tamilnad Mercantile Bank has received capital markets regulator Sebi’s nod to mop-up funds through an initial share sale.

The initial public offer (IPO) comprises a fresh issue of 1,58,27,495 equity shares and an offer for sale (OFS) of up to 12,505 equity shares by shareholders, according to the Draft Red Herring Prospectus.

The OFS consists sale of equity shares by D. Prem Palanivel, Priya Rajan, Prabhakar Mahadeo Bobde, Narasimhan Krishnamurthy, M. Malliga Rani and Subramanian Venkiteshwaran Iyer.

The bank, which filed its preliminary IPO papers with Sebi in September 2021, obtained its observations on May 30 this year, an update with the markets watchdog showed on Monday.

Going by the draft papers, the Tuticorin-based bank proposes to utilise the net proceeds from the fresh issue towards augmenting its Tier-I capital base to meet its future capital requirements.

Tamilnad Mercantile Bank is one of the oldest private sector banks in the country, with a history of almost 100 years.