The Hindu Business Line : PNB to raise Rs 1,500 cr more by March

Punjab National Bank (PNB) plans to raise further capital of about Rs 1,500 crore before end-March to fund business growth, the bank’s Executive Director, Mr K. Raghuraman, has said.

“We will do it only through Tier-II capital as we have headroom there. It will not be through tier-I perpetual bonds”, Mr Raghuraman told Business Line.

PNB has till date in the current fiscal raised Rs 1,100 crore through tier-I perpetual bonds. This includes the Rs 300 crore bonds raised last week at a borrowing cost of little over 9 per cent per annum.

Dr K.C. Chakrabarty, Chairman and Managing Director of PNB, had already made it clear that Government equity in the bank would not be reduced during the current fiscal. As on end-December 2007, the Centre had 57.80 per cent stake in PNB.

Overseas branches

Meanwhile, PNB is exploring the possibility of establishing presence in Bhutan and setting up of branch in Dubai International Financial Centre (DIFC).

PNB has received the RBI approval for upgrading its Shanghai representative office to a full-fledged branch in China and for having a joint venture agreement in Malaysia, Dr Chakrabarty said.

PNB has also received a licence for opening a dedicated micro-finance branch at Mukundpur in Delhi which is likely to be operationalised by March 2008.

This branch would be exclusively for financial inclusion of the urban poor.

The bank has plans to launch 10 pilot projects on financial inclusion out of which three projects have already been launched at Neemrana (Rajasthan), Tineri (Bihar) and Matki Jharoli (Uttar Pradesh).

PNB’s capital adequacy ratio at end-December 2007 stood at 14.04 per cent compared with 12.90 per cent at end-December 2006.

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