Financial Daily from THE HINDU group of publications
Tuesday, Jun 22, 2004
Financial Daily from THE HINDU group of publications Tuesday, Jun 22, 2004 |
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Money & Banking
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IPOs Syndicate Bank public issue likely in 2 months Our Bureau
Mr Michael Bastian
Chennai , June 21 SYNDICATE Bank's second public issue may hit the market in about two months.Two months is about what it could take for the "formalities" to be completed, the bank's Chairman and Managing Director, Mr Micheal Bastian, said here today. The public issue, at an "appropriate premium", will raise the bank's equity capital from Rs 471 crore to Rs 521 crore. Mr Bastian, said the bank had no intention of returning any capital to the Government. "Come 2006, we will have to go Basel-II," he said. Mr Bastian said that that adequate capital cushion would be needed then, as provisions have to be made against a wider range of risks such as market and operational risks. Today, banks provide only for credit risk. Syndicate Bank's investment portfolio has swollen to about Rs 22,000 crore from around Rs 18,000-crore at the end of January. Extra-SLR investments have doubled to about Rs 7,000 crore. The investments yield 8.9 per cent on an average. Mr Bastian said that Syndicate Bank had unrealised profits of about Rs 1,200 crore. The bank, however, will not liquidate its assets to book profits. It prefers to hold the security for interest income. Mr Bastian said that in the first quarter of the current year, the bank's sum of deposits and advances stood higher than what it was at the close of the last financial year. This is a "reversal of a trend", because there is usually a dip in the business in the first quarter of every year, he said.
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