LONDON STOCK EXCHANGE WELCOMES INDIA’S THE FEDERAL BANK TO ITS PROFESSIONAL SECURITIES MARKET
The Federal Bank Ltd., a leading private sector bank in India, today became the third Indian company to join the Professional Securities Market (PSM), the London Stock Exchange’s market for wholesale securities, launched in July 2005.
The Federal Bank raised a total of US$ 72 millionin an offering of 18,000,000 Global Depositary Receipts (GDRs), with each GDR representing one underlying share.
Mr. M. Venugopalan, Chairman and Chief Executive Officer, The Federal Bank, said:
“We are delighted with the success of our offering on the Professional Securities Market. We welcome the leading global institutions that have invested in our business and look forward to expanding our shareholder base further.”
Hugh Sandeman, Head of Business Development for India at the London Stock Exchange, said:
“The admission of The Federal Bank is further demonstration of how Indian companies can use PSM to raise capital to grow their businesses. This new market is a pragmatic solution for those overseas companies who elect to report in their home jurisdiction accounting standards, to access one of the world’s largest pools of international capital. We look forward to welcoming many more Indian companies to PSM.”
PSM is designed for issuers whose financial data are reported according to their own home-country accounting standards. By joining PSM, issuers still list directly with the UK Listing Authority (UKLA), but they are able to continue to use home jurisdiction accounting standards, instead of conforming to the new European Prospectus Directive requirement for listed companies to report financial data in accordance with International Financial Reporting Standards (IFRS).
The Federal Bank’s listing brings the total number of UK-listed Indian companies traded on the PSM and the Main Market to 22. In 2005, US$5.4 billion of Indian securities were traded on the Exchange’s markets.
Citigroup and Merrill Lynch acted as Joint Lead Managers and Joint Bookrunners to the offering.
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Notes to editors:
- About London Stock Exchange
London Stock Exchange is the world’s premier international equity exchange and a leading provider of services that facilitate the raising of capital and the trading of shares.
London Stock Exchange is the most international equities exchange by trading in the world and Europe's largest pool of liquidity. By the end of 2005, the market capitalisation of UK and international companies on the London Stock Exchange’s markets amounted to £4.1 trillion, with £5.2 trillion of equity business transacted over the year.
London Stock Exchange is a Recognised Investment Exchange (RIE) under the Financial Services and Markets Act 2000 and is supervised by the Financial Services Authority.
- Professional Securities Market:
The Professional Securities Market was established in July 2005, to coincide with the introduction of the FSA's new Listing Rules. PSM provides a solution for those issuers seeking to list securities in London without having to re-state their financial information to IFRS or following the additional requirements of an offering to retail investors. Debt securities or depositary receipts of any denomination may be listed on PSM on production of a prospectus aimed at a wholesale or professional audience.
- Depositary Receipts
These are dollar denominated, tradeable equity securities issued by a depositary bank on behalf of a foreign company.