The Hindu Business Line : LVB to consider bonus, rights

Lakshmi Vilas Bank's board will meet on July 6 to consider issues of shares on bonus and rights basis, the bank announced to the stock exchanges on Wednesday. The bank's capital adequacy ratio stands at 10.8 per cent, but its Chairman and Managing Director, Mr R M Nayak, said that there was "no compulsion" to raise capital.

With last year's retained earnings of Rs 16 crore, the bank's networth has grown to Rs 327 crore, against the regulatory requirement of Rs 300 crore. Yet, the bank has considered it prudent to shore up its capital. It has planned to raise its total business from Rs 7,400 crore in 2005-06 to Rs 10,000 crore in the current year.

Deposits are projected to grow from Rs 4,200 crore to Rs 6,000 crore; advances from Rs 3,200 crore to Rs 4,000 crore, Mr Nayak said. Profits are expected to grow commensurately. Last year, the bank reported a net profit of Rs 22.5 crore, compared with Rs 3 crore in the previous year.

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