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Financials

UPDATE 1-National Australia Bank increases capital raising plan by A$750 mln

(Adds context, CEO comment)

May 27 (Reuters) - National Australia Bank said on Wednesday it would increase the size of its share sale by A$750 million ($499 million), adding more capital to its coffers as it weathers the coronavirus crisis.

The increased size adds to the original target of A$500 million, taking the total amount to be raised under the plan to A$1.25 billion, at an issue price of A$14.15 per share.

NAB shares ended at A$16.64 on Tuesday, and have lost 32% so far this year.

The country’s third largest bank announced a A$3.5 billion capital raising in April, the biggest by an Australian company since the virus outbreak, of which the A$3 billion institutional placement was completed on April 28.

“Together with our recently completed institutional placement, the capital raised through the offer will assist us to manage through a range of possible scenarios related to the COVID-19 pandemic, including a prolonged and severe economic downturn,” NAB Group CEO Ross McEwan said.

The lender in April also cut its interim dividend to the lowest in almost three decades amid the coronavirsus crisis.

The impact from the pandemic has driven cash-strapped firms across Australia and New Zealand to equity markets in a bid to boost liquidity and create a buffer to survive the economic difficulties. ($1 = 1.5042 Australian dollars) (Reporting by Shreya Mariam Job in Bengaluru; Editing by Kim Coghill and Lincoln Feast.)

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