Temasek investment to boost growth – AU Bank MD

AU Small Finance Bank said it received its shareholders approval for Singapore-based Temasek to invest around Rs 1,000 cr in the bank for a stake of around 5%.

“This is the largest primary capital infusion in AU Bank and its first ever since their last raise in fiscal 2012,” said the bank, which went public via a Rs 1,913 cr IPO last year.

The IPO, it pointed out, was conducted using shares sold by its existing shareholders, and the proceeds of the same had gone to the shareholders rather than the bank.

The micro-lending focused bank said Temasek joins other investors such as IFC, Warburg Pincus, Chrys Capital and Kedaara Capital who already have stakes in the company.

AU, which started its journey in the year 1996 as an NBFC, gets most of its business from 11 states of North, West and Central India. The bank, with its base in Jaipur, has over 11,000 employees.

Sanjay Agarwal, MD & CEO of AU Bank said the funds will help the company remain sufficiently capitalized in the near term and achieve its target of 35-40% yearly growth.

In the last financial year, the bank reported a 60% growth in disbursements and mobilized around Rs 8000 crores of deposits.

“This capital raise will strengthen our presence in both the digital and the physical marketplace,” Agarwal said.

“We remain focused on bringing efficiencies in our delivery model and creating new products and services to address the diverse needs of our customers.We welcome Temasek to AU Bank.”