AU Small Finance Bank Limited has informed the Exchange regarding 'Non-Applicability of provisions related to Chapter XII of SEBI Circular dated August 10, 2021 (updated as on July 07, 2023), w.r.t. fund raising by Issuance of Debt Securities by Large Entities'.
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AU Small Finance Bank has told the exchanges that the SEBI circular dated August 10, 2021 (updated July 7, 2023), which requires 'Large Entities' to raise at least 25% of their incremental borrowings through the debt securities market, does not apply to the bank. This is because the bank does not fall within the definition of a 'Large Entity' as set out in Chapter XII of that circular, likely because it is categorised as a Small Finance Bank and falls below the prescribed thresholds. As a result, the bank has no mandatory obligation under this SEBI framework to source a portion of its incremental borrowings via listed debt securities.
This is a routine compliance clarification with no material impact on shareholders, the bank's capital structure, or the stock price. It simply confirms the bank is outside the scope of a specific SEBI debt-market funding requirement.