Indian Bank may tap capital market next fiscal

At present the government holds 80 per cent stake in the Chennai headquartered bank.

Written by Agencies | New Delhi | Published: February 27, 2012 4:26 pm

State-owned Indian Bank today said it may come out with follow-on public offer (FPO) next fiscal if market conditions are conducive.

“We do not require capital immediately…we may go in for FPO in the next fiscal (2012-13) if the market conditions improve,” Indian Bank Chairman and Managing Director T M Bhasin said.

The board has already given approval for the equity dilution to the extent of 10 per cent,he said.

At present the government holds 80 per cent stake in the Chennai headquartered bank.

Bhasin said the bank’s total capital adequacy stands at 13.56 per cent. Of this,Tier I is about 11.2 per cent.

Besides,there is Rs 6,300 crore headroom for Tier II capital.

Therefore,the bank has not made any capital request to the government for the current fiscal,he said.

Talking about overseas expansion plan,Bhasin said the bank plans to open a branch in Hong Kong and a representative office in Indonesian capital Jakarta.

Currently,the bank is seeking regulatory permissions for opening offices in these two locations,he said.

Enthused by its Sri Lankan operation,the bank is looking at opening three more branches in the country during 2012-13.

The bank opened its Jaffna branch last year,he said,adding,breakeven was achieved within 11 months of its operation.

The bank plans to open three more branches in Sri Lanka at Trincomalee,Batticaloa and Hambantota,taking the number of branches in the country to five,he said.

At present,Indian Bank has two branches in Jaffna and Colombo. Besides,the bank has a branch in Singapore.

Meanwhile,the bank opened its first SME branch in Delhi which will exclusively cater to the needs and requirement of the SME sector.

He said the SME portfolio is about Rs 8,000 crore as of now. It is expected to go up to Rs 9,000 crore by the end of the current fiscal.

The bank aims to expand the SME loan book to Rs 12,000 crore in the 2012-13,he added.

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