Business Daily from THE HINDU group of publications
Wednesday, Jul 19, 2006
Business Daily from THE HINDU group of publications Wednesday, Jul 19, 2006 |
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Money & Banking
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Corporate Bonds BoI to raise Rs 600 cr thru tier II capital Our Bureau
Kolkata , July 18 Bank of India has proposed to raise about Rs 600 crore by way of tier II capital, for which board approval has been received. The bank will raise the money through issue of unsecured, redeemable subordinated bonds, Mr M. Balachandran, CMD, said here today. He said that approval has also been received for private placement of upper tier II capital to the extent of about Rs 500 crore. There will be a green shoe component of another Rs 500 crore. The capital-raising plan will help improve the bank's capital adequacy ratio and shore up its long-term resources, it is pointed out. Currently, the Government holds 69 per cent of BoI's equity. "Banks are now allowed to utilise hybrid instruments for raising capital. We intend to make use of this provision," he told newspersons after addressing a meeting organised by FICCI. BoI, Mr Balachandran said, was looking at roughly 20-24 per cent growth in deposits and advances. Part of this will stem from overseas operations, which will be expanded through new offices. In Tanzania, the bank is set to establish a presence through a subsidiary, he added.
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