Punjab National Bank (PNB) is planning to raise up to Rs 1,800 crore by selling shares to institutional investors.

The state-owned bank has set the floor price for the qualified institutional placement (QIP) at Rs 35.51 per equity share.

PNB board met on Monday to approve the floor price and the launch of the issue. The bank said it has approved raising equity capital from qualified institutional investors to enhance its capital base.

The bank’s capital raising committee will meet again on 14 May to consider and determine the issue price, including up to 5% discount on the floor price.

While the base size of the share sale will be Rs 1,200 crore, the issue has an option to retain oversubscription up to Rs 600 crore.

In December, PNB had raised Rs 3,788.04 crore via QIP, bringing down the government holding in the bank from 85.59% to 76.87%. The board had earlier given nod for mobilising Rs 7,000 crore from QIP in one or more than one tranches.

Later, PNB said it was planning to raise the balance Rs 3,200 crore from share sale early this year.