BobCards net jumps 225

MUMBAI, Sept 30: BOB Cards Ltd, a fully-owned subsidiary of the Bank of Baroda, is exploring various options for infusion of capital of R...

MUMBAI, Sept 30: BOB Cards Ltd, a fully-owned subsidiary of the Bank of Baroda, is exploring various options for infusion of capital of Rs 10 crore, including a joint venture with a foreign or domestic partner, its chairman K Kannan said.

Addressing a press conference K Kannan, chairman and managing director, said that the infusion of additional capital is yet to be cleared by the bank8217;s board and in case the subsidiary8217;s request is turned down, it would have no option but to consider a joint venture, bringing down BOB8217;s holding to less than 30 per cent.

According to the Reserve Bank of India guidelines, a commercial bank can hold not more than 30 per cent of the capital of a subsidiary or hold the entire 100 per cent.

The board of directors in their meeting today, asserted the need for a capital infusion of Rs 10 crore to meet the technological requirements in an increasingly competitive credit card market.

8220;A public issue is not necessary at this stage. Rs 10 crore can easily be placed privately,8221;Kannan said. The bank was also planning to introduce a card for truck drivers in collaboration with Bharat Petroleum Corporation Ltd, with whom it already has a tie-up for a co-branded card. BOBCARDS Ltd, a wholly owned subsidiary of Bank of Baroda, has recorded a 225 per cent jump in its net profit to Rs 3.45 crore in 1997-98. The company has declared a dividend of 10 per cent for the year on a paid-up capital of Rs 10 crore.

The total turnover of the company has gone up by 17 per cent from Rs 719 crore in 1996-97 to Rs 844 crore during the period under review. This includes Rs 379 crore foreign exchange acquired against Visa and Mastercards.

The company8217;s profit before tax moved up to Rs 5.47 crore, registering an increase of 185 per cent over the previous year8217;s figure. The company has provided Rs 2.02 crore for taxation during the year.

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An amount of Rs 2 crore has been transferred to reserves. The company maintains its leadership in the number of electronic data capture terminals installed atmerchant locations. Over 1,250 terminals have been installed all over the country so far and the company plans to instal more such terminals in the days to come.

With a Visa tie-up, Bobcard Global is accepted at over 10.5 million establishments across the globe. The company has 31 branch offices and plans to open more in the near future.

Bobcards has a tie-up with Bharat Petroleum Corporation Ltd under which it issues Bharat Bobcard premium, a co-branded Visa card. The company also issues a proprietary card known as Bobcard, a Visa card called Bobcard silver, also referred to as the Sachin Tendulkar card and a premium category card called Bobcard exclusive with Mastercard.