Uco Bank plans to raise Rs 3,000 crore during 2020-21 as part of its efforts to sustain growth and comply with the Basel requirements on capital adequacy.

The board of directors of Uco Bank on Thursday gave its approval to raise the amount during the current financial year through various modes, such as a follow-on public offer, a qualified institutional placement and a preferential issue. The matter will be placed at the annual general meeting of the bank on August 7 for shareholder approval, the bank said in a statement to the bourses.

The city-based bank had a total capital of Rs 11,901 crore on risk weighted assets worth Rs 1,01,675 crore with a capital adequacy ratio of 11.70 per cent as on March 31, 2020. While the tier-1 capital was 8.98 per cent, the tier-2 capital stood at 2.72 per cent.

According to the requirement, banks in India need to have a regulatory capital of 9 per cent (1 per cent addition to the Basel prescription) along with an additional capital conversion buffer of 1.875 per cent which was stated to increase to 2.5 per cent by March 2020. The deadline for the implementation has been extended to September 30, 2020 on account of Covid-19.

Uco Bank expects a credit growth of 8-10 per cent which would push its risk weighted assets. The bank’s managing director and CEO A.K. Goel had said, based on the performance of the bank in the first two-three quarters, Uco would consider raising capital in the second half of the year.

As of the quarter ended June 30, 2020, the government held 94.44 per cent shares in the bank. The scrips of Uco bank at Rs 14.15 per share were up 0.07 per cent at the BSE.