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Seylan Bank was brought under the supervision of the banking regulator, the Central Bank, after it faced a run following the collapse of an unlisted Ceylinco group firm last year.
The central bank appointed a new board to Seylan Bank.
A previous attempt to get private sector investment in Seylan Bank failed.
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The bank said in a stock exchange filing that it will offer almost 54.3 million shares at 35 rupees each with subscriptions opening on September 22, 2009.
Existing ordinary voting shareholders as at the end of trading on September 2, the date of an extraordinary general meeting, will be entitled for a preferential allotment of one new ordinary voting share for every two held.
The prospectus would be delivered to brokers on September 3.
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Seylan Bank, which was part of the troubled Ceylinco group, has said its planned public offering to existing shareholders and a private placement with two state-run financial institutions is aimed at raising three billion rupees in fresh capita